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Category: Futures Trading

Futures trading is done by two main parties, one of which is the hedger and the other one is the speculator. Where a speculator is there to trade for either their own accounts or that of their clients, a hedger always uses futures as a possible protection from losses. Hedgers can also be described as individuals or business owners who are more risk averse. Speculators and hedgers are likely to benefit from futures trading if the trader has a strong ability to analyze the markets and understands that future behavior. Though futures can behigh risk, they offer an equally high return and are thus very tempting.

In case you are new to futures trading you need to understand how things work. We at Cannon Trading are there to help with your understanding of all the elements of futures trading and also counsel and advise you with the same. Our knowledge base featured on our website, is a store house of information. In order to know every aspect of futures trading, you must read through these articles that have been listed in this category archive. Go through it and get better informed!

Futures Trading Levels & Economic Reports for November 15, 2013

Posted on November 14, 2013September 16, 2014 by Ilan

Connect with Us! Use Our Futures Trading Levels and Economic Reports RSS Feed.

1. Market Commentary
2. Futures Support and Resistance Levels – S&P, Nasdaq, Dow Jones, Russell 2000, Dollar Index
3. Commodities Support and Resistance Levels – Gold, Euro, Crude Oil, T-Bonds
4. Commodities Support and Resistance Levels – Corn, Wheat, Beans, Silver
5. Futures Economic Reports for Friday November 15, 2013

Hello Traders,

For 2013 I would like to wish all of you discipline and patience in your trading!

Learn to lose….

Many different factors go into trading. Too many to discuss efficiently in one blog post. Some relate to trading techniques, other to money management, mental aspect, risk capital and much more.

But one that sticks in my eyes is the ability to take a loss. I see many clients who can make money and have days where they make money but when they lose, they lose much more, sometimes even losing control and losing a big portion of their account.

I am not sure how a trader can embed this into their trading mind, BUT in my opinion if you train your brain to expect losses, understand losses and losing days will happen, you will increase your chances of surviving in this business, which in return will actually give you a chance to succeed….

Losses are part of trading and as long as your losses are part of the plan and are quantified in advance and you can adhere to your rules, then you have a chance. I think it’s easy when traders are winning…making money etc. Much harder when you lose or down. your brain starts playing tricks on you…it tells you to double down, maybe reverse even though your analysis does not say so….all of a sudden you start pulling trades out of instinct, fear rather than a calculated plan that has solid risk/ reward. If a trader learns how to lose, to accept losses, to have realistic expectations, then he/ she can avoid having one of those terrible days when traders can lose almost of all their account.

I went into this subject and detailed day-trading money management in an article I wrote a few years back for SFO magazine.

You can read the full article at: https://www.cannontrading.com/community/newsletter/Survivor-Day-Trading-Different-Day-Trading-Money-Management-Modified-Hours-E-Minis#two

Continue reading “Futures Trading Levels & Economic Reports for November 15, 2013”

New Highs for S&P, Futures Levels & Economic Reports 11.14.2013

Posted on November 13, 2013September 16, 2014 by Ilan

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For 2013 I would like to wish all of you discipline and patience in your trading!

New highs on the SP500…..

I have drawn the extensions in the chart below last week…will be interesting to see if price respects those levels or not…I guess we can find out as early as tomorrow….

EP - E-Mini S&P 500, Equalized Active Daily Continuation — EP – E-Mini S&P 500, Equalized Active Daily Continuation

On a different note:

My opinion is that there are 3 main types of trading days.

Most common is two sided trading action with swings up and down – this type of trading day is most suitable for using support and resistance levels along with overbought /oversold indicators.
Strong trending day, mostly one directional – this type of trading day is the least common, many times will happen on Mondays and maybe 3-5 times a month at most – this type of trading day is most suitable for using ADX, MACD crossovers and pretty much looking for pullbacks to jump on the trend.
Slow and/ or choppy trading day – this type of trading day is best suited for taking small profits from the market by looking at volume spikes, using stochastics as possible entry signals and usually wait for a pullback before jumping in.

Good question is how can one asses what type of trading day we will have while the market is still trading….I am doing some work about it and will be happy to hear feedback via email but here are some initial observations:
1. Was the overnight session a wide, two sided trading range? If the answer is yes, good chances for similar trading day during the primary session ( primary session is when the cash/ stock market is open).
2. Mondays have the highest chance for trending days.
3. The behavior of the first hour of trading can also suggests the type of action for the rest of the day.
4. If the first 30 minutes have good volume, better chances for type 1 or type 2 trading days.
5. low volume during first 30 minutes can suggest a choppy (type 3 trading day).

Continue reading “New Highs for S&P, Futures Levels & Economic Reports 11.14.2013”

Gold Daily & Trading Levels & Economic Reports 11.13.2013

Posted on November 12, 2013September 16, 2014 by Ilan

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For 2013 I would like to wish all of you discipline and patience in your trading!

Gold and Silver took a hit today, selling off 1% and 2.5% respectively.

Gold and silver are much different markets in my opinion than mini SP or us tbonds for example. Gold, silver and crude oil for that matter are quite volatile with fear and greed playing a bigger role than in other markets. I have seen these markets make some very large moves intraday at times.

I do think that both gold and crude oil are GOOD markets to observe as potential for day-trading as long as you use stops…if you are a trader that “uses mental stops” , these markets are not for you…Good news is that both crude and gold have a mini contract .

Gold chart for your review below with some possible levels to watch for:

GCE - Gold (Globex), Equalized Active Daily Continuation — GCE – Gold (Globex), Equalized Active Daily Continuation

Continue reading “Gold Daily & Trading Levels & Economic Reports 11.13.2013”

Real Time Trade Alerts & Futures Levels & Economic Reports for 11.08.2013

Posted on November 7, 2013September 16, 2014 by Ilan

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For 2013 I would like to wish all of you discipline and patience in your trading!

BIG DAY tomorrow. Many reports including monthly unemployment figures. Be ready for higher volatility.

To continue on what i wrote yesterday regarding volume / range charts and using overbought / oversold indicators, below you will see 36 ticks range bar chart of gold futures from today’s session. The example below is of a good day for the model ( two sided trading ranges with volatility) and there are bad days just as well ( strong, one sided trend days).

The charts are sierra charts and the signals that appear are based on proprietary indicators developed by Ilan Levy-Mayer of LEVEX Capital Mgmt Inc. and VP of Cannon Trading Co, Inc.

The concept is a simple concept that looks for exhaustion in either buying/ selling and reversal. The signals that appear on the charts are alerting you for potential buy or sell IF/ONCE price confirmation occurred (crossing of the hull moving average). Full explanation along with chart samples included in the 23 page PDF booklets that comes with the free trial.

Would you like to have access to the DIAMOND and TOPAZ and 5T ALGOs as shown above and be able to apply for any market and any time frame on your own PC ? You can now have a three weeks free trial where the ALGO is enabled along with few studies for your own sierra/ ATcharts. The trial comes with a 23 page PDF booklet which explains the concepts, risks and methodology in more details.

Continue reading “Real Time Trade Alerts & Futures Levels & Economic Reports for 11.08.2013”

Volume Charts & Oscillators & Futures Levels & Economic Reports for 11.07.2013

Posted on November 6, 2013September 16, 2014 by Ilan

Connect with Us! Use Our Futures Trading Levels and Economic Reports RSS Feed.

For 2013 I would like to wish all of you discipline and patience in your trading!

Using tick/Volume charts and Oscillators for day trading

Using tick charts and oscillators for day-trading (by Ilan Levy-Mayer VP of Cannon Trading and CTA at Levex.net )

I really don’t think anyone has found a “perfect way” to day-trade.

Different techniques work well in different market environment.

In this week short educational feature, I will touch about one technique one can add to their trading arsenal. This technique works better on choppy, two sided ways. It DOES NOT work well when the market has a strong trend.

The chart below illustrates a few principals I like:

It uses a tick chart or Range Bar charts rather than a time chart. I like tick charts & range bar better when day-trading shorter time frames for the simple reason it already includes a big factor in the market, VOLUME and PRICE RANGE. If you are using 5 minutes chart for example, you may get signals simply because time “has passed” and certain indicators you are using adopt certain values. When using tick charts, at times where there is lots of movement in the market, you won’t have to wait until your time frame bar closes to get your signal, volume becomes a bigger more important part of your trading decision.

Read the remaining article “Using tick/Volume charts and Oscillators for day trading”

Continue reading “Volume Charts & Oscillators & Futures Levels & Economic Reports for 11.07.2013”

8 Steps for Successful Day Trading & Futures Levels & Economic Reports for 11.06.2013

Posted on November 5, 2013September 16, 2014 by Ilan

Connect with Us! Use Our Futures Trading Levels and Economic Reports RSS Feed.

For 2013 I would like to wish all of you discipline and patience in your trading!

8 Steps for successful Day-Trading

My name is Ilan Levy-Mayer and I am the Vice President and Senior Futures Broker at Cannon Trading. I came up with the following personal observations after serving online traders worldwide for more than 15 years.

The following steps are guides to progress, and are not necessarily in sequential order. Some of them are always required, but each futures trader is different and will relate to these stages in their own ways. While attempting to learn and progress, one must keep in mind that futures trading is risky and can involve significant losses.

1. Education

Hopefully if you are already trading you have completed your initial education: contract specs, trading hours, futures brokers, platforms, the opportunities as well as the risk and need to use risk capital in futures, and so on. Understanding this information is essential to futures trading. The second type of education is ongoing: learning about trading techniques, the evolution of futures markets, different trading tools, and more.

2. Find a System

I am definitely not advising you to go on the web and subscribe to a “black box” system (using buy/sell triggers if don’t know why they are being generated). What I am advising is developing a trading technique: a general set of rules and a trading concept. As you progress, you may want to put the different rules and indicators into a computerized system, but the most important factor is to have a focus and a plan. Don’t just wake up in the morning and trade “blank.”

3. Survival

This is the key! Do what you need to do in order to survive this brutal business and give yourself the chance of being here down the road with more experience and a better chance of success. Survival is probably the biggest key for beginning traders. There is a saying in this business: “live to trade another day.” It is so true!

READ THE REST…..

Continue reading “8 Steps for Successful Day Trading & Futures Levels & Economic Reports for 11.06.2013”

Real Time Trade Alerts – Trading Levels & Reports for 11.01.2013

Posted on October 31, 2013September 16, 2014 by Ilan

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For 2013 I would like to wish all of you discipline and patience in your trading!

To continue our mini Dow story from yesterday….After the close I got one of my “reversal” indicators to generate a sell signal as a counter trend trade. Personally to me, it gave a bit more confidence in the short side of the trade, HOWEVER, I think that actual trade management, where to place a stop, where to take profits, do you place a limit order for the target or do you just trail your stop ? these and other questions are probably the most important factors when it comes to success or failure of trades.

Daily chart for your review below.

YM - E-Mini Dow Futures - $5 Multiplier, Equlaized Active Daily Continuation — YM – E-Mini Dow Futures – $5 Multiplier

On a different note, I have a daily newsletter where I share trade set ups like the one above:

Get Real Time Trade Alerts Service via text and email
Would you like to receive a 30 day free trial to a new trade alert service?

Get new buy/ sell ideas along with suggested stops and profit targets in real time.

This trade alert service was developed and published by LEVEX Capital Management Inc. ( “LEVEX”) a registered CTA with the CFTC and member of the NFA.

“LEVEX” will transmit alerts via text and/or email with potential buy and sell recommendations for different commodities along with suggested stops and profit targets. The alerts are based on technical analysis and using a computerized model developed by “LEVEX”.

Each day the program runs a market scan to look for markets that fit certain technical criteria / trade algorithm developed by LEVEX Capital management Inc. Once a market has been identified as a possible high probability set up, you will receive a trade alert with the trade idea.

Continue reading “Real Time Trade Alerts – Trading Levels & Reports for 11.01.2013”

Mini Dow Futures Outlook & Risk/Reward – Trading Levels & Reports for 10.31.2013

Posted on October 30, 2013September 16, 2014 by Ilan

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For 2013 I would like to wish all of you discipline and patience in your trading!

So FOMC came and gone and like I said many times before, many times the real reaction comes the next day.
Which way, I am not sure but I am sharing a daily chart of the mini Dow futures where I see either potential for double top if we hold below today’s high OR potential for a break above and move towards the next FIBONACCI extension as seen on the chart.

As always in our business….time will tell, which brings me to a different point I would like to share:

My thoughts are as follow, there is probably 65% chance this market will try to make a new high and break today’s high ( in my opinion), however, I think that is we make a new high it will not be that much further than were we at now. While I think there is better chances for a move up, I think that if we do make a move down, there are HIGHER probabilities for a larger move downside than a larger move to the upside….hope this make sense. Based on this personal view of mine, I will look for a short set up with relatively small stop in hopes to catch the next big wave down. it may take a few attempts on my end but I like the risk / reward of this set up and hope that by sharing the thought process I gave you an idea on another approach for trading.

Continue reading “Mini Dow Futures Outlook & Risk/Reward – Trading Levels & Reports for 10.31.2013”

Stock Index Futures = Different Personalities, Trading Levels and Economic Reports October 29, 2013

Posted on October 28, 2013September 16, 2014 by Ilan

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For 2013 I would like to wish all of you discipline and patience in your trading!

Big week ahead for stock index futures as well as other markets.

We have FOMC taking place tomorrow and Wednesday with rate announcement coming out Wednesday.

A few other reports that did not take place during the shut down are released this week. Make sure you check forexfactory.com for updated report times.

I think that stock index futures have been a little harder to trade these past few years…With the Fed injecting money using the QE program, the “normal market forces” are not in play as much as in other markets. I personally miss the days where stock index futures traded “freely” and can’t wait for what I consider normal, free market forces to determine price action. That being said, it is what it is and I guess FED action is part of the market right now and we as traders need to adjust.

What i wrote above is part of the reason i find markets like crude oil, gold, grains and even bond futures more appealing for trading. So if any of you have some what of a similar feeling to what I described above and looking for alternative markets – let me know and I can be of help by suggesting different markets and pointing out some of the characteristics for the different markets.

Continue reading “Stock Index Futures = Different Personalities, Trading Levels and Economic Reports October 29, 2013”

Different Ways to Invest in Commodities and Futures

Posted on October 28, 2013September 16, 2014 by Ilan

When it comes to investing in commodities/futures there are several different ways to do so. I’ve been a futures broker at Cannon Trading Company for about 4 years and I wanted to touch base on a few different ways I have seen clients trade and invest in futures and commodities over the years.

I have seen many investors (small and large) participate in trading ETFs or ETF funds. With ETFs you do not own the actual commodity but you are looking to track the performance on either a single commodity or commodity index containing many different commodities through either its physical storage or derivatives positions in the market.

I do not accommodate trading ETFs or ETF funds with my actual clients. I am a registered futures broker and here at Cannon Trading Company we do not accommodate ETF trading for our clients. Please keep in mind the differences when trading ETFs versus commodities and futures. With ETFs you may experience management fees where as if you have a self directed futures and commodities trading account you will not experience those types of fees. Also when trading futures, unless you have a limited power of attorney on your account where you authorize another individual to trade your account, there is not a third party making your trading decisions and trading your account on your behalf. Here, at Cannon Trading Company many futures/commodities trader have self directed accounts where he or she makes their own decisions when it comes to trading.

Continue reading “Different Ways to Invest in Commodities and Futures”

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Gold and Silver took a hit today, selling off 1% and 2.5% respectively.

BIG DAY tomorrow. Many reports including monthly unemployment figures. Be ready for higher volatility.

Using tick/Volume charts and Oscillators for day trading

1. Education

2. Find a System

3. Survival