The Small Exchange

Guide to Futures and Spread Trading - This comprehensive ebook, compliments of Guy Bower, is designed to help you understand and master the fundamentals of futures spread trading. Guide to Futures and Spread Trading includes access to premium web content.

Whilst the stock markets demand significant start-up capital, futures do not. In fact, your futures chart will probably look similar to your stock chart, with opportunities to buy low and sell high. So here's my questions: This means you can apply technical analysis tools directly on the futures market.

Futures Spread Trading is the best kept secret in trading!

Scalping futures can be a great way to hedge a big up day or just pass the pass the time. There are techniques to scalping futures that if done right be fun, profitable, and protect your existing positions. If done wrong they can be detrimental.

Day trading futures for beginners has never been easier. Technology has ensured brokers, accounts, trading tools, and resources are easier to get hold of than ever. So, how do you go about getting into trading futures? Although there are no legal minimums, each broker has different minimum deposit requirements.

E-mini futures have particularly low trading margins. Margin positions vary from broker to broker, however, TD Ameritrade and NinjaTrader offer attractive margin deals. This is one of the most important investments you will make.

Most intraday traders will want a discount broker, offering you greater autonomy and lower fees. What should you look for from a futures broker then? Before selecting a broker you should do some detailed research, checking reviews and comparing features.

For more detailed guidance, see our brokers page. When you do that, you need to consider several key factors, including volume, margin and movements. Look for contracts that usually trade upwards of , in a single day. Margin has already been touched upon. Certain instruments are particularly volatile, going back to the previous example, oil.

This means you need to take into account price movements. Fortunately, you can establish movement by considering two factors: A simple average true range calculation will give you the volatility information you need to enter a position.

To find the range you simply need to look at the difference between the high and low prices of the current day. So, what do you do? Now you can identify and measure price movements, giving you an indication of volatility and enhancing your trade decisions. So, with an understanding of comparing volume, volatility, and movement between future contracts, what should you opt for? Crude oil is another worthwhile choice. Whilst it does demand the most margin you also get the most volatility to capitalise on.

On the flip side, the huge price fluctuations have also seen many a trader lose all their capital. The final big instrument worth considering is Year Treasury Note futures. Viewing a 1-minute chart should paint you the clearest picture. Whether you are interested in day trading strategies for Emini futures or Dax futures, all the points and examples below are applicable. Charts and patterns will help you predict future price movements by looking at historical data.

The best strategies take into account risk and shy away from trying to turn huge profits on minimal trades. Below, a tried and tested strategy example has been outlined. To do this, you can employ a stop-loss.

You should also have enough to pay any commission costs. Another one of the best futures day trading strategies is scalping, used by many to reap handsome profits. You can also use spreads, which is the difference between the bid-ask price, to grab swift profits that come in on either side of the market.

This makes scalping even easier. As you can see, there is significant profit potential with futures. SIM doesn't do justice for real life slippage, fills, ect.

The COST of comish, spread, slippage needs to be carefully understood in your market. Beating costs is huge for scalping strats. Scalping futures successfully and consistently is one of the hardest most challenging goals out there in the world of trading. Furthermore, comparing sim results to cash is akin to comparing masturbation with an orgy with Playboy bunnies. Visaria , Manuel , bone and 2 others like this. You must log in or sign up to reply here.

Your name or email address: This amount varies from market to market and time of day. For example, look at the tickets below. The first one is for a Gold spread. The bid price is If an immediate exit were wanted, it would be a loss. Since the trade was bought at If sold for Until the opposing price moves to the price paid to enter the trade, there is no profit yet.

However, knowing this will always be the case whenever a trade is entered, it becomes less of a shock and simply part of the trade.