Trading guide, as you can understand from the term, is a compilation of tips and tricks that can help you in trading. Whether you are new to the world of trading or are an expert in it, a trading guide is a very useful document.
Moreover, every trading guide has a specific purpose. So, if you are thinking about trading, a trade guide will serve you like a self-help manual. So, whether it is about trading options, metals, grains or any other futures contract– a trading guide has all the information in it.
You don’t need to buy one, for you will able to find a number of them online. We at Cannon Trading help you make the most of your trading ventures. Therefore, we have compiled some of the best trading guides for you to learn from. Listed under this category archive are some trade guides using which you can use to help you succeed in many trading ventures. There is enough information in these guides that can help you master the art of trading futures and options smartly.
The PriceCount study is a tool that can help to project the distance of a move in price. The counts are not intended to be an ‘exact’ science but rather offer a target area for the four objectives which are based off the first leg of a move with each subsequent count having a smaller percentage of being achieved. It is normal for the chart to react by correcting or consolidating at an objective and then either resuming its move or reversing trend. Best utilized in conjunction with other technical tools, PriceCounts offer one more way to analyze charts and help to manage your positions and risk. Learn more at www.qtchartoftheday.com
Trading in futures, options, securities, derivatives or OTC products entails significant risks which must be understood prior to trading and may not be appropriate for all investors. Past performance of actual trades or strategies is not necessarily indicative of future results.
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About: Cannon Trading is an independent futures brokerage firm established in 1988 in Los Angeles. Our mission is to provide reliable service along with the latest technological advances and choices while keeping our clients informed and educated in the field of futures and commodities trading.
Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
The futures trading market, known for its high risk and high reward potential, is not only a game of skill and strategy but also one that requires choosing the right futures broker. For novice and seasoned traders alike, navigating the world of future brokers can be fraught with challenges, especially when determining who to trust. With so much at stake—both financially and emotionally—it is crucial to recognize the signs of a reliable futures broker versus the red flags of an unreliable one. This guide will dive into the top ten signs of a trustworthy broker and the ten glaring warning signs to avoid, drawing on real-world cases, hypotheticals, and practical advice. We will also explore how traders can minimize their risks and why firms like Cannon Trading Company stand out as exceptional choices in the futures trading landscape.
Top Ten Signs of a Reliable Futures Broker
Regulatory Compliance and Transparency A trustworthy futures broker is always registered with reputable regulatory bodies, such as the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA) in the U.S. These registrations ensure compliance with stringent standards. Look for clear disclosures on their website, including license numbers and links to verification tools.
Case Study: A trader working with a broker fully licensed by the NFA avoided significant losses when the broker promptly alerted clients to regulatory changes affecting margin requirements. This transparency showcased the firm’s commitment to protecting its clients’ interests.
Comprehensive Educational Resources Reliable futures brokers invest in educating their clients. They provide webinars, tutorials, and market analyses tailored to both beginners and experienced traders. Access to free trading platforms for practice is another strong indicator of a broker’s credibility.
Hypothetical: A beginner is torn between two brokers. One offers a free demo account and extensive learning material, while the other provides no educational resources. The beginner chooses the former and gains valuable experience in futures trading without risking real money.
Fair and Transparent Fee Structures Reputable brokers clearly outline their fee structures, including commissions, margin rates, and withdrawal fees. Hidden charges are a sign of a broker to avoid.
Real Example: Cannon Trading Company is known for its transparency, offering clients detailed breakdowns of trading costs, ensuring there are no surprises.
Quality Customer Service Trustworthy future brokers provide responsive and knowledgeable customer service, available across multiple channels, including phone, email, and live chat. Look for brokers with highly rated customer support.
Hypothetical: A trader faces a platform error during a critical market movement. The broker’s 24/7 support resolves the issue within minutes, preventing significant losses.
User-Friendly Platforms A good broker provides intuitive and reliable trading platforms that cater to various levels of expertise. Features like advanced charting tools, real-time data, and easy execution of trades are essential.
Case Study: A trader using a platform provided by a reliable broker successfully executed a stop-loss order during a market crash, avoiding catastrophic losses thanks to the platform’s reliability.
Access to a Wide Range of Markets Reliable futures brokers offer access to various markets, from commodities and indices to currencies and energy. This diversity allows traders to build robust portfolios.
Strong Online Reputation High ratings on platforms like TrustPilot and positive reviews across forums and social media reflect a broker’s trustworthiness. Cannon Trading Company, for example, boasts numerous 5-star reviews, highlighting its reliability.
Risk Management Tools Trustworthy brokers emphasize the importance of risk management by providing tools like stop-loss orders, margin calculators, and alerts.
Industry Longevity Experience matters in futures trading. Brokers with decades of operation have weathered market changes, proving their resilience and reliability.
Example: Cannon Trading Company, with over 30 years in the industry, has built a stellar reputation for reliability and integrity.
Ethical Practices Trustworthy brokers never pressure clients into excessive trading, upsell unnecessary products, or promise unrealistic profits. Their goal is long-term partnerships, not short-term gains.
Top Ten Red Flags of an Unreliable Futures Broker
Lack of Regulatory Oversight Brokers without registration with major regulatory bodies are immediate red flags. Always verify their credentials.
Hypothetical: A trader works with an unregulated broker who disappears overnight with their funds—a devastating yet avoidable situation.
Unrealistic Profit Guarantees Promising guaranteed returns in futures trading is a major red flag. The futures market is inherently volatile, and no broker can ensure profits.
High-Pressure Sales Tactics Brokers that pressure clients into making quick decisions or investing more than they’re comfortable with are not to be trusted.
Case Study: A novice trader was persuaded to over-leverage their account, resulting in significant losses when the market turned against them.
Hidden Fees Shady brokers often bury exorbitant fees in the fine print, from withdrawal charges to “maintenance fees.”
Example: One trader discovered after a year that their broker charged monthly inactivity fees, eroding their profits.
Poor Customer Support Brokers that are difficult to reach or provide vague responses to inquiries are signs of trouble. A lack of support can be disastrous during market volatility.
Unreliable Platforms Frequent outages, execution delays, or lack of robust security measures are clear signs of a broker to avoid.
Fake Reviews and Endorsements Be wary of brokers with overly polished or suspiciously similar online reviews. Genuine testimonials are diverse and specific.
Limited Account Transparency Reliable brokers offer full visibility into account activity. Lack of transparency may signal mismanagement or fraud.
Excessive Leverage Offers Brokers offering extremely high leverage may be enticing but are often designed to capitalize on inexperienced traders’ losses.
Unverified Claims of Longevity Brokers claiming decades of experience without proof or clear histories are likely unreliable.
Navigating Pedestals and Pitfalls as a Beginner
For those new to trading futures, separating the reliable from the questionable can be daunting. Follow these steps to minimize financial and emotional risk:
Do Your Homework Research brokers extensively. Use resources like the NFA’s BASIC system to verify registrations.
Start Small Begin with small trades to learn the mechanics of futures trading without risking significant capital.
Leverage Demo Accounts Take advantage of brokers offering free trading platforms and demo accounts to practice.
Understand the Market Educate yourself on futures trading, including market terminology, strategies, and risk management.
Ask Questions A reliable broker will answer all questions openly. If a broker seems evasive, look elsewhere.
Avoid High-Pressure Sales Walk away from brokers pushing you into decisions without providing ample time for consideration.
Why Cannon Trading Company Excels in Futures Trading
Cannon Trading Company exemplifies the qualities of a reliable futures broker. With over 30 years in the industry, it is regulated by the CFTC and a proud member of the NFA. The company is renowned for its transparency, offering clear fee structures and a range of account options. Its free trading platform allows beginners to learn the ropes without financial pressure, while its exceptional customer service ensures clients receive timely support.
Moreover, Cannon Trading Company’s stellar reputation on TrustPilot, with numerous 5-star ratings, speaks volumes about its reliability. The firm prioritizes client education through webinars and detailed market analyses, enabling traders to make informed decisions. Its dedication to ethical practices and robust regulatory compliance sets it apart in a crowded market.
The future trading market is filled with opportunities, but success begins with choosing the right futures broker. Recognizing the signs of a reliable broker—such as regulatory compliance, transparent fees, and quality support—while avoiding red flags like hidden charges, poor customer service, and unregulated operations can save traders from costly mistakes. For beginners, starting small, asking questions, and leveraging educational resources can help navigate this challenging yet rewarding field. Brokers like Cannon Trading Company stand out for their decades of experience, ethical practices, and commitment to client success, making them a top choice for trading futures.
Ready to start trading futures? Call us at 1(800)454-9572 – Int’l (310)859-9572 (International), or email info@cannontrading.com to speak with one of our experienced, Series-3 licensed futures brokers and begin your futures trading journey with Cannon Trading Company today.
Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involve substantial risk of loss and are not suitable for all investors. Past performance is not indicative of future results. Carefully consider if trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
Important: Trading commodity futures and options involves a substantial risk of loss. The recommendations contained in this article are opinions only and do not guarantee any profits. This article is for educational purposes. Past performances are not necessarily indicative of future results.
This article has been generated with the help of AI Technology and modified for accuracy and compliance.
As financial markets continue to experience unprecedented levels of volatility, futures brokers in the USA play an increasingly critical role in helping traders navigate the complexities of futures trading. Heading into 2025, the unpredictability of global economic conditions, geopolitical events, and shifting monetary policies underscore the need for strategic intervention by futures brokers. Traders face unique challenges and opportunities in these conditions, making the guidance of experienced professionals more valuable than ever.
In this article, we will examine how futures brokers in the USA can assist their clients in managing volatility, offering ten actionable techniques supported by real-life trades, case studies, and hypotheticals. We will also explore why Cannon Trading Company, a leading futures broker with a stellar reputation, is an exceptional choice for traders seeking stability in turbulent times.
Hedging with Futures Contracts
One of the primary ways futures brokers help clients manage volatility is through hedging. By taking opposing positions in the futures market, traders can protect themselves against adverse price movements in underlying assets. For example:
Case Study: A soybean farmer fears a drop in prices before the next harvest. By working with a futures broker, the farmer sells soybean futures contracts to lock in current prices. When the market later experiences a downturn due to surplus production, the loss in the physical market is offset by gains in the futures trading position.
Through personalized hedging strategies, futures brokers in the USA provide peace of mind to clients worried about market swings.
Utilizing Options on Futures
Another effective technique is trading options on futures contracts. These instruments provide traders the right, but not the obligation, to buy or sell futures at a specific price. For instance:
Hypothetical Example: An energy company anticipates rising oil prices but wants limited risk exposure. A futures broker advises purchasing call options on crude oil futures. If oil prices soar, the call options generate profit. If prices fall, the company’s loss is capped at the premium paid.
Options on futures trading offer traders a way to benefit from volatility while managing risk.
Spreading Strategies
Spread trading, which involves taking offsetting positions in related contracts, is another volatility management tool. Examples include calendar spreads (trading futures with different expiration dates) and intercommodity spreads.
Real-Life Example: A trader anticipates narrowing spreads between corn and wheat prices. A futures broker helps the trader go long on corn futures while shorting wheat futures. As the price gap tightens, the trader realizes gains irrespective of overall market direction.
This strategy reduces exposure to absolute price volatility and focuses on relative price movements.
Leveraging Stop-Loss Orders
Stop-loss orders are a critical tool for managing downside risk in volatile markets. A futures broker can work with clients to establish stop-loss levels tailored to their risk tolerance.
Case Study: A gold trader enters a long position expecting prices to rise due to inflation concerns. The futures broker sets a stop-loss order at a 5% decline. When prices unexpectedly drop due to a stronger dollar, the order is triggered, limiting losses.
Stop-loss orders ensure disciplined trading futures even in chaotic market conditions.
Using Technical Analysis
Futures brokers often provide clients with advanced charting tools and technical analysis to identify key market levels. These insights help traders execute informed decisions.
Example: A professional trader collaborates with a futures broker to analyze historical price patterns in the S&P 500 futures market. Using Fibonacci retracements and moving averages, they pinpoint entry and exit points during a volatile earnings season.
By leveraging technical analysis, futures brokers in the USA empower clients to act decisively.
Diversifying Across Asset Classes
Diversification is a time-tested approach to mitigating risk. Futures brokers can guide traders in creating portfolios with exposure to various asset classes, such as commodities, equities, and currencies.
Hypothetical Example: A trader overly reliant on equity index futures is advised by their futures broker to diversify into agricultural commodities. When equity markets experience heightened volatility, gains in agricultural futures trading help stabilize the portfolio.
This strategy minimizes reliance on a single market segment.
Providing Real-Time Market Insights
Modern futures brokers in the USA offer access to real-time data and expert commentary to help clients anticipate and respond to market moves.
Example: During the 2022 energy crisis, Cannon Trading provided clients with timely analysis of natural gas futures. Traders who acted on this information navigated extreme price fluctuations more effectively than those without broker insights.
Access to accurate, up-to-date information is a cornerstone of successful trading futures.
Structured Trade Execution
Effective execution can make or break a trade during periods of high volatility. Experienced futures brokers employ smart order routing and execution algorithms to reduce slippage.
Case Study: A high-frequency trader enters the E-mini S&P 500 futures market during a Fed announcement. With the help of a futures broker’s advanced platform, orders are executed swiftly, locking in favorable prices before the market reacts.
Top-tier execution is an often-underestimated advantage provided by reputable futures brokers in the USA.
Educating Clients Through Webinars and Research
Education is vital for empowering traders to manage risk. Many futures brokers, including Cannon Trading, provide webinars, market reports, and one-on-one consultations.
Real-Life Example: In 2023, Cannon Trading hosted a webinar on “Trading Futures During High Volatility.” Participants learned strategies to navigate unpredictable interest rate announcements, which they later applied successfully in live trades.
Educational resources ensure traders are equipped to make informed decisions in volatile markets.
Offering Access to Diverse Trading Platforms
In a fast-paced environment, the right trading platform can be the difference between success and failure. Leading futures brokers in the USA provide clients with access to state-of-the-art platforms tailored to their needs.
Example: A swing trader uses a multi-asset platform from Cannon Trading to monitor futures, options, and spot markets simultaneously. This integrated view helps them identify arbitrage opportunities during a market selloff.
The ability to trade seamlessly across markets enhances resilience in volatile times.
Why Choose Cannon Trading Company for Managing Volatility?
Cannon Trading Company is a standout in the crowded field of futures brokers in the USA, offering unmatched experience, client support, and technological resources. Here’s why Cannon is an excellent choice for traders concerned about market volatility:
Decades of Experience: With over 35 years in the industry, Cannon Trading has weathered countless market cycles, making it a trusted partner in uncertain times.
Top Regulatory Standards: Cannon Trading operates under strict compliance with U.S. regulatory bodies, providing traders with a secure and transparent trading environment.
Highly Rated Service: The company boasts dozens of 5 out of 5-star ratings on TrustPilot, reflecting exceptional customer satisfaction.
Diverse Platforms: Whether you are a beginner or a seasoned trader, Cannon Trading offers access to top-tier platforms like CQG, TradeStation, and Sierra Chart.
Tailored Support: Cannon Trading’s personalized service helps traders develop customized strategies to navigate volatility effectively.
For traders seeking a reliable partner in futures trading, Cannon Trading delivers expertise, technology, and trustworthiness.
As we approach 2025, market volatility is likely to remain a defining feature of financial markets. Futures brokers in the USA play an indispensable role in helping traders navigate these challenges through hedging, diversification, advanced execution, and education. From stop-loss orders to real-time insights, the techniques outlined above demonstrate the breadth of strategies available to clients.
With a proven track record, comprehensive platform offerings, and a commitment to client success, Cannon Trading Company is uniquely positioned to assist traders in managing risk and capitalizing on opportunity in the world of futures trading. By leveraging the resources and expertise of leading futures brokers, traders can approach market volatility with confidence and resilience.
Ready to start trading futures? Call us at 1(800)454-9572 – Int’l (310)859-9572 (International), or email info@cannontrading.com to speak with one of our experienced, Series-3 licensed futures brokers and begin your futures trading journey with Cannon Trading Company today.
Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involve substantial risk of loss and are not suitable for all investors. Past performance is not indicative of future results. Carefully consider if trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
Important: Trading commodity futures and options involves a substantial risk of loss. The recommendations contained in this article are opinions only and do not guarantee any profits. This article is for educational purposes. Past performances are not necessarily indicative of future results.
This article has been generated with the help of AI Technology and modified for accuracy and compliance.
A futures trader is a professional who buys and sells futures contracts on commodities, financial instruments, and other assets in order to profit from fluctuations in their price. Engaging in futures trading involves significant risk and complexity, but when done right, it can yield considerable rewards. However, to maintain a long-term career in futures trading, a trader must adhere to a set of core principles that promote sustainable growth and risk management. Key principles for longevity in this field include emotional control, adherence to trading plans, disciplined risk management, and an understanding of how to balance opportunity with caution. Futures trading is a demanding profession, and those who approach it without a structured approach often find themselves struggling to maintain consistency.
Emotional Control: The Backbone of Successful Futures Trading
One of the most critical principles for any futures trader is emotional control. The fast-paced nature of trading futures, coupled with the significant leverage available, can make it easy to fall into the traps of fear and greed. Emotional control allows traders to respond to market movements calmly rather than react impulsively, which is essential in avoiding irrational decisions that can lead to losses.
For instance, a futures trader may be tempted to double down on a losing position out of frustration or stubbornness, hoping to recoup losses. However, experienced traders know that emotional decisions are rarely profitable in the long term. Instead, successful futures traders have the discipline to cut losses when needed and avoid revenge trading — the tendency to try and “win back” losses through risky moves. Achieving emotional control is often about creating a mindset that recognizes that losses are a natural part of trading in futures and can be managed with a clear strategy.
While emotional control is vital, it can also conflict with the excitement of seizing opportunities. The futures market often presents fast-moving opportunities, and a futures trader may feel an impulse to “catch the wave” of a sudden price move. However, seasoned traders understand that making emotionally driven decisions rarely yields consistent profits. They approach each opportunity with a clear mind and refrain from overtrading, no matter how tempting it may feel in the moment.
The Role of a Trading Plan: Consistency and Structure
A trading plan is a carefully crafted roadmap that outlines a trader’s strategy, including entry and exit points, stop-loss levels, position sizes, and risk tolerance. For a futures trader, adhering to a trading plan is crucial for maintaining consistency in an environment known for its volatility. A trading plan helps remove the emotional component from decision-making, as it provides clear guidelines on how to react under different market conditions.
One of the most significant challenges that futures traders face is resisting the urge to deviate from their trading plans in pursuit of short-term gains. Trading in futures can sometimes feel unpredictable, and an unexpected market shift may lead traders to stray from their plan to try to capitalize on a sudden price movement. While the allure of quick profits can be strong, a successful futures trader recognizes the importance of sticking to the plan and avoiding impulsive trades that do not align with their long-term objectives.
For example, let’s say a futures trader sees an unexpected market rally that they did not anticipate in their plan. Jumping in impulsively could expose them to excessive risk and result in a significant loss if the market reverses. Instead, a disciplined futures trader will assess the situation and determine if the opportunity aligns with their trading criteria. If not, they will patiently wait for a setup that fits their plan. This adherence to a structured approach not only minimizes unnecessary risks but also helps in building a consistent track record over time.
Risk Management: Avoiding Overleveraging in Futures Trading
Risk management is arguably one of the most important principles for anyone involved in futures trading. Unlike other forms of trading, futures contracts are highly leveraged, allowing a futures trader to control large positions with a relatively small amount of capital. While this leverage can magnify profits, it also significantly increases the potential for losses. Proper risk management involves understanding the potential downside of each trade and implementing safeguards to protect capital.
One of the main ways to manage risk is by avoiding overleveraging. Overleveraging occurs when a trader takes on too large a position relative to their account size, which can lead to substantial losses if the market moves unfavorably. Many futures traders are tempted to overleverage in an attempt to maximize profits, but this approach often leads to a quick depletion of their capital. Instead, experienced traders limit their leverage to a level that allows them to weather market volatility without risking catastrophic losses.
Resisting overleveraging is critical, but it sometimes conflicts with a trader’s desire to take advantage of an attractive opportunity. For instance, if a futures trader identifies what they perceive as a high-probability trade, they may feel compelled to increase their leverage to maximize their gains. However, seasoned traders understand that any single trade carries risk, and overextending oneself on one trade can lead to financial trouble. The most successful futures traders balance their enthusiasm for opportunity with a disciplined approach to leverage, ensuring that they have enough capital to remain in the market for the long haul.
Choosing the Right Broker: The Value of Support and Expertise
While discipline and skill are essential, selecting a reliable futures broker is also a crucial decision for any futures trader. The right broker provides a foundation of support, from trade execution to customer service and technical troubleshooting. Cannon Trading Company, for instance, is known for its decades of experience in the futures markets, and with a 5 out of 5-star rating on TrustPilot, it has established a reputation for reliability and client satisfaction.
Working with a broker like Cannon Trading offers multiple advantages for futures traders trading futures. First, their extensive experience in the futures markets means they understand the nuances and challenges traders face daily. This insight allows them to provide valuable guidance and support, which can be especially beneficial for newer traders who are still learning the complexities of trading futures. Additionally, their high customer service ratings indicate a strong commitment to assisting clients promptly, which can be essential in the fast-paced world of futures trading where platform issues or trade execution delays can have financial consequences.
Cannon Trading’s dedication to customer service and troubleshooting helps traders focus on their strategies without the added stress of technical issues. In futures trading, having a broker who can resolve issues efficiently and provide ongoing support can be the difference between a successful trade and a missed opportunity. Cannon Trading’s ratings reflect their reliability in providing broker assistance, which is invaluable for futures traders who rely on quick access to information and a seamless trading experience.
Continuous Learning and Adaptability in Futures Trading
The futures markets are constantly evolving, with new technologies, strategies, and market conditions emerging regularly. For a futures trader to succeed over the long term, a commitment to continuous learning is essential. This could involve studying market trends, understanding new regulations, or refining trading strategies based on past experiences. A willingness to adapt and evolve as a trader ensures that one remains competitive and avoids becoming complacent.
Additionally, the support of a knowledgeable broker like Cannon Trading Company can aid in this learning process. With their years of experience, they can offer educational resources, insights, and market analysis that are beneficial to traders at all skill levels. Leveraging the resources provided by an experienced broker can help traders stay informed and make more educated decisions.
Balancing Discipline and Opportunity in Futures Trading
The life of a futures trader is a delicate balance between seizing opportunities and maintaining discipline. The desire to capitalize on favorable market conditions is natural, but without the guiding principles of emotional control, adherence to a trading plan, and disciplined risk management, traders may fall into habits that undermine their long-term success. Resisting the temptation to overleverage and choosing a trustworthy broker like Cannon Trading Company can further support a sustainable approach.
Futures trading is not a career suited to impulsive decision-making or excessive risk-taking. Traders who respect the markets, remain vigilant, and continuously refine their strategies have the best chances of success. The journey of a futures trader is marked by patience, adaptability, and a focus on consistent, incremental gains rather than high-stakes risks. By adhering to these core principles and leveraging the support of an experienced broker, traders can pursue a rewarding and sustainable career in the dynamic world of futures trading.
Ready to start trading futures? Call us at 1(800)454-9572 – Int’l (310)859-9572 (International), or email info@cannontrading.com to speak with one of our experienced, Series-3 licensed futures brokers and begin your futures trading journey with Cannon Trading Company today.
Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involve substantial risk of loss and are not suitable for all investors. Past performance is not indicative of future results. Carefully consider if trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
Important: Trading commodity futures and options involves a substantial risk of loss. The recommendations contained in this article are opinions only and do not guarantee any profits. This article is for educational purposes. Past performances are not necessarily indicative of future results.
This article has been generated with the help of AI Technology and modified for accuracy and compliance.
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Explore trading methods. Register Here* This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.
#Equities, #Consolidation phase, #Interest rates, #Precious metals, #Gold, #Silver, #US Dollar, #Crude oil prices, #HurricaneHelene, #Middle East tensions, #Chinese stimulus, #Redbook US Retail Sales, #Case Schiller US Metro-Area Home Prices, #Richmond Fed Manufacturing Index, #Service Sector Index, #Consumer Confidence, #New Home Sales, #Micron Technology
By John Thorpe, Senior Broker With Equities quietly trading in a consolidation phase, Interest rates following, the precious metals ,once again found footing and surprised many traders with their mid-day upside move, Gold higher by $36.00 @ 2689.00, Silver up $1.50 into the $32.50 /Troy OZ range.. The US Dollar @ 100.10 continuing it’s 2.5 month long slide, flirting with 14 month lows of 99.22. Metals should gain additional strength if the dollar falls below that number on a closing basis. Todays Headlines Updated: September 24, 2024 6:12 am Churning hurricane threatening US production, continued Middle East tensions, and Chinese stimulus measures have helped crude oil prices trade higher on Tuesday. Updated: September 24, 2024 7:00 am China’s central bank announced its largest stimulus measures since the pandemic. The bank will lower interest rates and additional funding. However, analysts say very week consumer and business demand for credit will have little response to lower interest rates, and the lack of fiscal stimulus measures will leave the central bank’s response to fall short of jump starting the economy and beating back deflationary environment. Updated: September 24, 2024 7:55 am Redbook Weekly US Retail Sales Headline Recap **Redbook Weekly US Retail Sales were +5.2% in the first three weeks of September 2024 vs September 2023 **Redbook Weekly US Retail Sales were +4.4% in the week ending September 21 vs yr ago week Updated: September 24, 2024 8:00 am Case Schiller 20 US Metro-Area Home Prices Recap **Case Schiller 20 US metro area home prices for July Y/Y: +5.9% from the year ago month **Case Schiller 20 US metro area home prices for July M/M: +0.01% vs prior month Updated: September 24, 2024 9:02 am Richmond Fed Manufacturing Index Headline Recap **Richmond Fed September Manufacturing Index: -21.0 ; prior -19.0 **Richmond Fed September Manufacturing Shipments Index: -18.0 ; prior -15.0 **Richmond Fed September Manufacturing New Orders: -23.0 ; prior -26.0 **Richmond Fed September Manufacturing Employees: -22.0 ; prior -15.0 **Richmond Fed September Manufacturing Prices Paid: +3.36 ; prior +2.45 **Richmond Fed September Manufacturing Prices Received: +1.57 ; prior +1.87 **Richmond Fed September Service Sector Index:-1.0 ; prior -11.0 Updated: September 24, 2024 9:09 am Conference Board Consumer Confidence, Present Situation, Expectations Index Headline Recap **Conference Board September Consumer Confidence Index: 98.7 ; prior revised to 105.6 from 103.3 ; expected 102.8 **Conference Board September Consumer Present Situation Index: 124.3 ; prior revised to 134.6 from 134.4 **Conference Board September Consumer Expectations Index: 81.7 ; prior revised to 86.3 from 82.5 Tomorrows Movers and Shakers New Home Sales Released On 9/25/2024 10:00:00 AM For Aug, 2024 US new home sales data for June will be updated Wednesday morning at 9:00 am CT. Analysts expect new home sales month-to-month at a 0.640 mln unit annualized pace, up +3.4%. The prior month’s sales were -11.3% at 0.619 mln unit annual rate. Micron Technology reports after the close
* This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.
#Equities, #Consolidation phase, #Interest rates, #Precious metals, #Gold, #Silver, #US Dollar, #Crude oil prices, #HurricaneHelene, #Middle East tensions, #Chinese stimulus, #Redbook US Retail Sales, #Case Schiller US Metro-Area Home Prices, #Richmond Fed Manufacturing Index, #Service Sector Index, #Consumer Confidence, #New Home Sales, #Micron Technology
September 23, 2024 by GalTrades.com
Powel said at the Jackson hole meeting, “The time has come for policy to adjust,” The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook and the balance of risks.”
It didn’t matter if we got a .25 or .50 basis point rate cut, earnings growth will determine if the market can keep going up.
The market made new all-time highs, but only one MAG7 stock made new all-time high, META. That means the rally is broadening, a positive point for the market.
The S&P is currently trading at a forward P/E of 21 which suggests that a lot has been priced regarding the bull thesis. Valuations are high and that should be noted. How much higher can the market go up? remains to be seen.
“don’t fight the Fed” or “don’t fight the trend” are statements to sustain near-term bullish momentum. Aside from the FED cutting rates, the economy still appears to be on firm footing.
Next week the earnings and economic calendar is relatively light, outside of next Friday’s PCE report, but perhaps this can be conducive for recent bullish momentum. In the absence of news, the path of least resistance is higher. Yes, we are still in the midst of bearish seasonality, but the technicals look encouraging.
Going forward bad news is good news because the FED will need to lower rates on bad news, unless the news is disastrous.
As long as the SPX can remain above July’s prior all-time closing high 5,667, we should see continuation. An SPX close below 5,667 could introduce concerns of a false breakout to all-time highs, which would likely introduce some additional selling pressure
A positive point: 76% of the S&P 500 stocks are above there 50 Day Moving Averages and 76% are above their 200 Day MA.
Year to date the two top performing factors were momentum and growth which were up 29/27 % respectively. The two worst preforming groups were yield and value stocks. In the last 3 month that flipped. Dividend and value stocks get an uptick when rates come down.
I see analysts calling for the small caps to go up with rate cuts. The action on Wednesday didn’t show that. It may be wise to react as opposed to jumping in now. It would make more sense for mid-caps to go up prior to small caps as there are more profitable companies in mid-cap sectors.
Statistics show post-election the markets usually end higher. And in the past when the FED has cut rates in a soft landing, or no landing markets ended up higher for the next 6 to 12 months almost 100% of the time.
Cyclical, mortgage, auto loan rates and small cap stand to benefit from rate cuts.
Rate cuts can ignite small caps and value stocks. The IJR index contains a higher % of companies which are profitable as opposed to the IWM Russell 2000.
Bull market indicators usually benefit capital market plays, stocks such as; CBOE, IBKR, BLK, GS. Rate cuts should help the homebuilders XHB ETF.
If Fed rate cuts can bring short-end bond yields down to more normal rates, then banks wouldn’t have to overcompensate at the long end and longer-term loans like mortgages could come down. That would put more money in the pockets of everyday Americans and help fuel all sectors of the stock market — not to mention the benefit lower rates have on valuations.
Commodities and oil prices are down, rates are coming down. That’s all good for companies and the consumer.
Energy companies as opposed to the price of oil. historically this sector has been one of the best sectors going into a rate cut. What we didn’t have in the past is a slowdown in China, that narrative should put a lid on appreciation. There may be some individual names that are exceptions.
FINISH ARTICLE HERE
Daily Levels for September 23, 2024
Economic Reports
provided by:ForexFactory.com
All times are Eastern Time ( New York)
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Explore trading methods. Register Here* This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.
Important Notices – Heavy Fed Speaking, Active Data, Few Earnings
Futures 101 – Tick Size & Minimum Fluctuations
Hot Market of the Week – March Sugar
Broker’s Trading System of the Week – Copper Swing Trading System
Trading Levels for Next Week
Trading Reports for Next Week
Important Notices – Next Week Highlights:
The Week Ahead
Heavy Fed Speak Week, active data and a few earnings highlight the week ahead.
Light Earnings, by largest Market Cap
Wed, Micron Technologies After the close
Thursday, Accenture pre-open, Costco after the close
Fed Speak schedule
Mon. Goolsbee 9:15am CDT, Kashkari Noon CDT
Tues. Bowman 8:00am CDT
Wed. Kugler 3:00pm CDT
Thu. Collins 8:10amCDT, Powell 8:20am CDT, Williams 8:25 CDT, Treasury Sec. Yellen 10:15am CDT
Big Economic Data week:
Mon. S&P PMI Flash
Tues. Case-Shiller Home prices, CB Consumer Confidence, Redbook, Richmond Fed.
Wed. Building Permits, New Home Sales
Thur. Jobless Claims, Core PCE Final, GDP Final, Durable goods, Pending Home sales
Fri. Personal Income, Retail and Wholesale Inventories, Michigan consumer sentiment
How to Rollover on the E-Futures Platform video below
Futures 101: Tick Movements: Understanding How They Work
Minimum Price Fluctuation
All futures contracts have a minimum price fluctuation also known as a tick. Tick sizes are set by the exchange and vary by contract instrument.
E-min S&P 500 tick
For example, the tick size of an E-Mini S&P 500 Futures Contract is equal to one quarter of an index point. Since an index point is valued at $50 for the E-Mini S&P 500, a movement of one tick would be
.25 x $50 = $12.50
NYMEX WTI Crude Oil
The tick size of the NYMEX WTI Crude Oil contract is equal to 1 cent and the WTI contract size is 1,000 barrels. Therefore, the value of a one tick move is $10.
Summary
Tick sizes are defined by the exchange and vary depending on the size of the financial instrument and requirements of the marketplace. Tick sizes are set to provide optimal liquidity and tight bid-ask spreads.
The minimum price fluctuation for any CME Group contract can be found on the product specification pages.
Hot market of the week is provided by QT Market Center, A Swiss army knife charting package that’s not just for Hedgers, Cooperatives and Farmers alike but also for Spread traders, Swing traders and shorter time frame application for intraday traders with a unique proprietary indicator that can be applied to your specific trading needs.
March sugar has shifted its formation back to the topisde and activated upside PriceCount objectives in the process. The chart accelerated to its first upside count to the 21.85 area. It would be normal to get a near term reaction form theis level in the form of a consolidation or corrective trdae. IF you can sustain further strength, the second count projects a possible run to the 23.26 area.
PriceCounts – Not about where we’ve been, but where we might be going next!
The PriceCount study is a tool that can help to project the distance of a move in price. The counts are not intended to be an ‘exact’ science but rather offer a target area for the four objectives which are based off the first leg of a move with each subsequent count having a smaller percentage of being achieved. It is normal for the chart to react by correcting or consolidating at an objective and then either resuming its move or reversing trend. Best utilized in conjunction with other technical tools, PriceCounts offer one more way to analyze charts and help to manage your positions and risk. Learn more at www.qtchartoftheday.com
Trading in futures, options, securities, derivatives or OTC products entails significant risks which must be understood prior to trading and may not be appropriate for all investors. Past performance of actual trades or strategies is not necessarily indicative of future results.
Broker’s Trading System of the Week
With algorithmic trading systems becoming more prevalent in portfolio diversification, the following system has been selected as the broker’s choice for this month.
The performance shown above is hypothetical in that the chart represents returns in a model account. The model account rises or falls by the average single contract profit and loss achieved by clients trading actual money pursuant to the listed system’s trading signals on the appropriate dates (client fills), or if no actual client profit or loss available – by the hypothetical single contract profit and loss of trades generated by the system’s trading signals on that day in real time (real‐time) less slippage, or if no real time profit or loss available – by the hypothetical single contract profit and loss of trades generated by running the system logic backwards on back adjusted data. Please read full disclaimer HERE.
Would you like to receive daily support & resistance levels?
* This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.
Futures trading is a dynamic and complex field that offers numerous strategies to accommodate different trading styles and objectives. Futures traders must understand the various approaches and tools available to them to make informed decisions and optimize their trading performance. This article provides a detailed exploration of several key trading strategies and concepts in futures trading, including swing trading, momentum trading, calendar spread futures trading, butterfly spread, high-frequency futures trading, crack spread, statistical arbitrage, and the impact of low margin rates on futures trading.
1. Swing Trading in Futures
Definition and Overview
Swing trading is a popular trading strategy in the futures market that involves holding positions for several days or even weeks to capitalize on short- to medium-term price movements. Unlike day trading, where positions are closed within the same trading day, swing traders aim to capture the “swings” in the market—short-term price fluctuations caused by market volatility.
How Swing Trading Works
Swing traders typically use technical analysis to identify potential entry and exit points. They look for patterns such as head and shoulders, flags, and triangles to predict price movements. Swing traders may also use indicators like moving averages, RSI (Relative Strength Index), and MACD (Moving Average Convergence Divergence) to confirm their predictions.
The key to successful swing trading lies in timing. Traders must be able to accurately predict when a trend will start and end, which requires a deep understanding of market dynamics and the ability to interpret chart patterns.
Advantages of Swing Trading
Flexibility: Swing trading allows traders to maintain a regular job or pursue other interests because it does not require constant monitoring of the markets.
Lower Transaction Costs: Since positions are held for longer periods compared to day trading, swing traders incur fewer transaction costs.
Potential for High Returns: By capturing significant price movements, swing traders can achieve substantial returns over time.
Disadvantages of Swing Trading
Overnight Risk: Holding positions overnight exposes swing traders to risks from unexpected market events, such as geopolitical developments or economic announcements, that can lead to significant price gaps.
Requires Patience: Swing trading requires patience, as traders must wait for the right market conditions to enter and exit trades.
Best Practices for Swing Trading
Use Stop-Loss Orders: To manage risk, swing traders should always use stop-loss orders to limit potential losses.
Stay Informed: Swing traders must stay informed about market news and events that could impact their positions.
Focus on Liquid Markets: Trading in highly liquid futures markets ensures that positions can be easily entered and exited without significant price slippage.
2. Momentum Trading in Futures
Definition and Overview
Momentum trading is a strategy based on the idea that assets that have been performing well will continue to do so in the near future, while assets that have been underperforming will continue to decline. Momentum traders aim to capitalize on the continuation of existing trends by entering trades in the direction of the momentum.
How Momentum Trading Works
Momentum traders use technical indicators like the Moving Average Convergence Divergence (MACD), Relative Strength Index (RSI), and the Momentum Indicator to identify trends and assess their strength. Once a trend is identified, momentum traders enter positions in the direction of the trend, holding the position until signs of a reversal or a slowdown in momentum appear.
Advantages of Momentum Trading
Potential for Quick Profits: Momentum trading can generate quick profits if the trader accurately identifies and capitalizes on strong trends.
Clear Entry and Exit Signals: Momentum indicators provide clear signals for entering and exiting trades, making the strategy easier to implement for traders who are skilled in technical analysis.
Disadvantages of Momentum Trading
High Risk of Reversals: Momentum trading carries the risk of sudden trend reversals, which can result in significant losses if the trader is not quick to react.
Requires Constant Monitoring: Momentum traders need to closely monitor the market to act swiftly when trends begin to reverse.
Best Practices for Momentum Trading
Trade in Active Markets: Momentum trading works best in highly active markets where trends are strong and persistent.
Use Multiple Indicators: Relying on a combination of momentum indicators can help traders confirm trends and reduce the risk of false signals.
Set Tight Stop-Losses: To manage risk, momentum traders should set tight stop-losses to protect against sudden reversals.
3. Calendar Spread Futures Trading
Definition and Overview
Calendar spread futures trading, also known as a time spread or horizontal spread, involves simultaneously buying and selling futures contracts on the same underlying asset but with different expiration dates. This strategy is used to profit from changes in the price difference (spread) between the two contracts.
How Calendar Spread Trading Works
In a calendar spread, the trader typically buys a futures contract with a longer expiration date and sells a futures contract with a shorter expiration date, or vice versa. The idea is to profit from the change in the spread between the two contracts as market conditions evolve. The spread can widen or narrow based on factors such as supply and demand, seasonality, or changes in market sentiment.
Advantages of Calendar Spread Trading
Reduced Risk: Calendar spreads generally have lower risk compared to outright futures positions because the trader is exposed to the price difference between the two contracts rather than the full price movement of the underlying asset.
Lower Margin Requirements: Because the risk is lower, margin requirements for calendar spreads are typically lower than for outright futures positions.
Disadvantages of Calendar Spread Trading
Complexity: Calendar spreads can be more complex to manage than simple long or short futures positions, as traders need to understand the factors that influence the spread.
Limited Profit Potential: The profit potential in calendar spread trading is generally lower than in outright futures trading because the price movement of the spread is typically smaller than the movement of the underlying asset.
Best Practices for Calendar Spread Trading
Monitor Market Conditions: Traders need to stay informed about market conditions that can affect the spread, such as changes in supply and demand or seasonal trends.
Use Technical Analysis: Technical analysis can help traders identify opportunities in calendar spreads by analyzing historical spread patterns.
4. Butterfly Spread in Futures Trading
Definition and Overview
A butterfly spread is a neutral options strategy that combines a bull spread and a bear spread. It involves buying and selling options with three different strike prices but with the same expiration date. In futures trading, a similar strategy can be applied using futures contracts.
How Butterfly Spread Trading Works
A typical butterfly spread in futures trading might involve buying one futures contract at a lower price, selling two contracts at a middle price, and buying one contract at a higher price. The goal is to profit from the price of the underlying asset remaining close to the middle strike price at expiration. The strategy profits if the underlying asset’s price is close to the middle strike price and losses are minimized if the price moves significantly in either direction.
Advantages of Butterfly Spread Trading
Limited Risk: The maximum loss is limited to the initial cost of setting up the spread.
Potential for High Reward: If the market price ends up near the middle strike price, the potential reward can be high relative to the risk.
Disadvantages of Butterfly Spread Trading
Limited Profit Potential: While the risk is limited, so is the profit potential, which is capped by the distance between the middle and outer strike prices.
Requires Precise Market Prediction: To profit from a butterfly spread, the trader must accurately predict that the market will remain within a narrow price range.
Best Practices for Butterfly Spread Trading
Use in Low Volatility Markets: Butterfly spreads work best in markets where volatility is low and prices are expected to remain stable.
Monitor Implied Volatility: Changes in implied volatility can affect the pricing of the options or futures contracts used in the butterfly spread, so traders should keep an eye on volatility levels.
5. High-Frequency Futures Trading
Definition and Overview
High-frequency trading (HFT) is a type of algorithmic trading characterized by the use of powerful computers to execute a large number of orders at extremely high speeds. In futures trading, HFT involves placing and executing orders within fractions of a second to take advantage of small price discrepancies in the market.
How High-Frequency Trading Works
HFT firms use sophisticated algorithms to analyze market data and execute trades at lightning speeds. These algorithms are designed to identify and exploit inefficiencies in the market, such as temporary price discrepancies between different exchanges or financial instruments. The profits per trade are usually very small, but the high volume of trades can result in significant overall profits.
Advantages of High-Frequency Trading
High Profit Potential: HFT can generate significant profits due to the sheer volume of trades executed.
Market Efficiency: HFT contributes to market efficiency by quickly correcting price discrepancies.
Disadvantages of High-Frequency Trading
Requires Advanced Technology: HFT requires significant investment in technology and infrastructure, including powerful computers and high-speed internet connections.
High Risk: The high speed and volume of trades mean that small errors in the algorithm can lead to substantial losses.
Best Practices for High-Frequency Trading
Develop Robust Algorithms: The success of HFT depends on the quality of the algorithms used, so it’s essential to invest in the development and testing of robust trading algorithms.
Monitor Latency: In HFT, even milliseconds can make a difference, so traders need to minimize latency in their trading systems.
6. Crack Spread in Futures Trading
Definition and Overview
The crack spread is a trading strategy used in the energy markets, particularly in oil and gas futures. It involves taking positions in the futures of crude oil and refined products like gasoline and heating oil to profit from the price difference (spread) between crude oil and its refined products.
How Crack Spread Trading Works
A typical crack spread trade involves buying or selling crude oil futures while simultaneously selling or buying futures contracts for refined products. The trader profits from changes in the spread between the price of crude oil and the prices of its refined products. For example, if the price of gasoline increases relative to crude oil, the spread widens, and a trader holding a long crack spread position would profit.
Advantages of Crack Spread Trading
Hedge Against Refining Margins: For companies involved in refining, the crack spread can serve as a hedge against fluctuations in refining margins.
Speculative Opportunities: Traders can speculate on the future direction of the spread based on factors such as seasonal demand, refinery outages, and changes in crude oil supply.
Disadvantages of Crack Spread Trading
Complexity: Understanding the relationship between crude oil and its refined products requires specialized knowledge of the energy markets.
Volatility: The crack spread can be highly volatile, leading to significant risks if not managed properly.
Best Practices for Crack Spread Trading
Stay Informed About the Energy Markets: Traders need to be aware of factors that can affect the supply and demand for crude oil and refined products, such as geopolitical events, weather patterns, and refinery capacity.
Use Risk Management Tools: Given the volatility of the crack spread, it’s essential to use risk management tools like stop-loss orders to protect against adverse price movements.
7. Statistical Arbitrage in Futures Trading
Definition and Overview
Statistical arbitrage (stat arb) is a trading strategy that uses mathematical models to identify and exploit price inefficiencies in the market. In futures trading, statistical arbitrage involves trading pairs or groups of futures contracts that have historically shown a statistical relationship, with the expectation that any deviations from this relationship will eventually revert to the mean.
How Statistical Arbitrage Works
Stat arb traders use historical price data and statistical models to identify pairs of futures contracts that are expected to move together. When the price of one contract deviates from its expected relationship with the other, the trader takes a long position in the undervalued contract and a short position in the overvalued contract. The positions are then held until the prices converge, at which point the trader closes the positions for a profit.
Advantages of Statistical Arbitrage
Market Neutrality: Because statistical arbitrage involves taking both long and short positions, it is generally market-neutral, meaning it is less affected by overall market direction.
Diversification: Statistical arbitrage strategies can be applied across multiple asset classes, providing opportunities for diversification.
Disadvantages of Statistical Arbitrage
Requires Advanced Analytical Skills: Implementing a statistical arbitrage strategy requires a deep understanding of statistical methods and access to large datasets.
Execution Risk: The success of statistical arbitrage depends on the accurate execution of trades, and small delays or errors can lead to losses.
Best Practices for Statistical Arbitrage
Use Robust Statistical Models: The key to successful stat arb trading is the accuracy of the statistical models used to identify trading opportunities.
Continuously Monitor Positions: Market conditions can change rapidly, so it’s important to continuously monitor positions and adjust the strategy as needed.
8. What Low Margin Rates on Futures Means for Your Trading
Definition and Overview
Margin is the amount of money required to open and maintain a futures position. It acts as a good faith deposit to ensure that the trader can cover potential losses. Low margin rates mean that traders need to put up less capital to control a larger position in the futures market.
Impact of Low Margin Rates on Futures Trading
Low margin rates can have a significant impact on futures trading by increasing leverage. With lower margins, traders can control larger positions with a smaller initial investment, which can amplify both potential profits and potential losses.
Advantages of Low Margin Rates
Increased Leverage: Lower margin requirements allow traders to leverage their capital more effectively, potentially leading to higher returns on investment.
Greater Market Access: Lower margins make futures trading accessible to a wider range of traders, including those with smaller account balances.
Disadvantages of Low Margin Rates
Higher Risk: While low margin rates increase potential profits, they also increase the risk of substantial losses. Traders need to be careful not to over-leverage their positions.
Margin Calls: If the market moves against a highly leveraged position, traders may face margin calls, requiring them to deposit additional funds or liquidate positions at a loss.
Best Practices for Trading with Low Margin Rates
Manage Leverage Carefully: Traders should be cautious about over-leveraging their positions and should always have a clear risk management plan in place.
Use Stop-Loss Orders: To protect against large losses, traders should use stop-loss orders to automatically close positions if the market moves against them.
Futures trading offers a wide array of strategies and approaches, each with its own set of advantages and challenges. Whether you are engaging in swing trading, momentum trading, calendar spread trading, or any of the other strategies discussed, it is crucial to have a deep understanding of the market dynamics and to implement effective risk management practices. Additionally, the impact of low margin rates cannot be overstated, as they can significantly influence the risk and return profile of your trading activities.
By mastering these strategies and understanding the underlying concepts, futures traders can better navigate the complexities of the market and increase their chances of success. Each strategy requires a unique set of skills and knowledge, and the choice of strategy should align with the trader’s individual goals, risk tolerance, and market outlook.
Ready to start trading futures? Call us at 1(800)454-9572 (US) or (310)859-9572 (International), or email info@cannontrading.com to speak with one of our experienced, Series-3 licensed futures brokers and begin your futures trading journey with E-Futures.com today.
Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involve substantial risk of loss and are not suitable for all investors. Past performance is not indicative of future results. Carefully consider if trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
Important: Trading commodity futures and options involves a substantial risk of loss. The recommendations contained in this article are opinions only and do not guarantee any profits. This article is for educational purposes. Past performances are not necessarily indicative of future results.
This article has been generated with the help of AI Technology and modified for accuracy and compliance.
Futures traders with positions in deliverable futures contracts keep an eye on the calendar for important dates at the end of the month. First Notice Day (FND) and Last Trading Day (LTD) for many futures contracts are close at hand. Make sure you steer safely clear of receiving delivery notices for physical commodities (FND), or greatly reduced liquidity (LTD). If you’re unsure, contact your Cannon Trading Co. broker.
The economic calendar for the rest of the week is scarce with Thursday’s Q1 GDP report taking center stage.
Prospects for a fed rate cut announcement at the Fed’s 4/30-5/1 meeting, as well as its mid-June meeting have all but evaporated and many Fed watchers expect the central bank to keep its “higher for longer” mantra in place for most and possibly all of 2024.
Worries over a wider Middle East conflict have subsided and traders are discounting the risk of further escalations. Case in point, June gold lost ±67 per ounce (±2%) yesterday after posting its latest all-time record high close of $2,413.80/ounce on Friday. Iran downplayed Israel’s retaliatory drone strike against it, in what appeared to be a move aimed at averting regional escalation.
Energies:
The ±$2.50/barrel selloff in May crude oil and the ±¢9.75/gallon May RBOB gasoline futures last week likely signaled the markets do not see an Iranian supply disruption in the near future, so the markets will be given to focusing on global energy demand going forward
Softs:
May Cocoa futures declined sharply yesterday and today, down nearly $1,300/ton (a $13,000 per contract move) marking its worst two-day slump since February. This after a 3-day / Wed.-Fri. rally of $1,635/ton to its all-time record high close of 11,878/ton on Friday. ICE U.S. has set the initial margin requirement to $11,260 per contract.
* This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.
RISK DISCLOSURE: Past results are not necessarily indicative of future results. The risk of loss in futures trading can be substantial, carefully consider the inherent risks of such an investment in light of your financial condition.
Economic Reports
provided by: ForexFactory.com
All times are Eastern Time ( New York)
US new home sales data for June will be updated Wednesday morning at 9:00 am CT. Analysts expect new home sales month-to-month at a 0.640 mln unit annualized pace, up +3.4%. The prior month’s sales were -11.3% at 0.619 mln unit annual rate. Micron Technology reports after the close 
