Category Archives: Index Futures

Introduced in the year 1982, Index futures or stock index futures are extremely popular among trading commodities today. While trading, an index future is settled in cash on the value of a certain stock market index. One of the most traded indices is the S&P500.

These are quoted on the basis of either an underlying or a spot price for an index value. There are a number of technicalities involved, most of which you should understand. However, even if you find it tough to comprehend what Index futures are, you can take assistance from the trade experts at Cannon Trading.

We at Cannon Trading want you to understand the basics and the details about Index Futures like our experts do. There are a number of blogs that we list here in our category archive. We recommend that you read these to know for yourself what Index Futures trading is all about.

Weekly Newsletter 1078: Rollover Notice and Trading Tips During Rollover & Support and Resistance Levels for the Week Ahead

December 10th, 2021 Filed under Financial Futures, Index Futures, Weekly Newsletter | Comment (0)

Cannon Futures Weekly Letter Issue # 1078

Dear Traders,

Like us on FaceBook!

www.facebook.com/CannonTrading

Get Real Time updates and market alerts on Twitter!

Trading 201: Trading During Rollover

Rollover Notice for U.S. Stock Index, Currency and Financial Futures

Heads up traders! We’re approaching important dates on the trading calendar.

Monday, December 13th is Last Trading Day for December currency futures. It is of the utmost importance for currency traders to exit all December futures contracts and start trading the next quarterly futures contract and the new front month: March ’22. Currency futures are DELIVERABLE contracts. By holding any December futures contracts through the close of Last Trading Day, you will be subject to delivering (short positions) or taking delivery of (long positions) the full notional value of the futures contract.

For stock index futures traders, on Friday, Dec. 17th, the Dec. ’21 futures contracts will officially halt trading and the exchange will cash settle all open positions at 8:30 A.M., Central Time. Thursday, December 9th marked the traditional date traders started rolling Dec. stock index futures trades to the next quarterly futures contract and the new front month: also March ’22. Come forward to the new front month for the next ±90 days.

Finally, for financial futures traders (Ultra bonds, 30-yr. T-bonds, 2-, 5-, 10-yr. T-notes, etc.) the traditional roll-over day was Nov. 30th/First Notice Day (the date all open LONG positions became subject to delivery). The next front month – and now by far the more liquid – is also March ’22. For all longs and shorts not in the deliverables market, it’s time to trade March ’22 contracts.

The March exchange symbol for all these futures contracts is “H.” Check for the appropriate complete symbol for these new front month futures contracts on your trading/charting software. Make sure your quotes, charts, DOM’s are set to the correct futures contract month.

Keep in mind the following:

Currencies are DELIVERABLE and you must be out and trading March as of today, Friday Dec. 10th
Stock index futures are cash settled on Friday Dec. 17th at 9:30 AM Eastern Time.
During the rollover period, especially with stock index futures, I noticed that the first few days will have two sided, volatile action. Think about it, you have large traders and institutions who are NOT day traders and carry large positions as speculation or a hedge and now they need to rollover from Dec. to March.
In my opinion, counter trend methods, mean reversion techniques can work better during rollover period but one must be very aware as past performance is not indicative of futures results.
Keep in mind, back in the days, many floor traders would “trade the spread” specifically with different techniques. I believe some traders still do using the screen.
Bottom line is know that this is rollover period, do research on past rollover periods, start trading the March contract and good trading and happy holidays!

Good 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 when it comes to Futures Trading.

Futures Trading Levels

12.13.2021

Support & Resistance Levels 12.13.2021

Weekly Levels

Weekly Support & Resistance Levels

Reports, First Notice (FN), Last trading (LT) Days for the Week:

https://mrci.com

Date Reports/Expiration Notice Dates

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

Advice from a Seasoned Broker w/ Current Market Conditions & Support and Resistance Levels 12.08.2021

December 7th, 2021 Filed under Day Trading, Future Trading News, Index Futures | Comment (0)

I am often asked by clients and prospects the following:

“I am not doing very well in my current trading – any ideas you can share?”

While the answer will vary from one individual to another based on their experience, risk capital, personality and much more, here are a few common themes one can explore and try to educate oneself:

Try a different market. Many will trade the NQ and ES but perhaps trading markets like bonds, gold and crude oil will fit your situation better?
Try using different time frames. Most common is use higher time frames and less leverage
Get confidence using MICROS. Practice and confidence are extremely important. After a while demo lacks the main Ingredients: fear and greed. Trading live using MICROS can be a worthy extra step.
Have you looked at using options for short term trading rather than futures?
Have you explored trading futures alongside options and using the options as risk management?
What about future spreads?
Option Spreads?

The bottom line is that trading futures is a tough task but there are many different ways to try and get an edge. Not all ways will fit all traders. Learn, explore and try to find your niche.

Good Trading

Futures Trading Levels

12-08-2021

Economic Reports, Source:

https://bettertrader.co/

Weekly Newsletter 1077: Adjust your Trading with Volatility & Futures Levels for the Week Ahead

December 3rd, 2021 Filed under Future Trading News, Index Futures, Indices, Weekly Newsletter | Comment (0)

Cannon Futures Weekly Letter Issue # 1077

Dear Traders,

Like us on FaceBook!

www.facebook.com/CannonTrading

Get Real Time updates and market alerts on Twitter!

Trading 201: Adjust your Trading with Volatility

Unemployment report along with Omicron along with an already “very spicy markets” encouraged me to share some of the following pointers.

Hope it helps.

*While I have no idea were the market is going from day to day, minute to minute, week to week etc. I do know that in the past, some of the sharpest and largest rallies were short covering after a large sell off. More often than not market sell offs and volatility like we are seeing do not end up as V type of action but more like U or W when it is all said and done.

*Expect the unexpected…

* Have an idea of what you are looking to do, keep in mind possible risk and have a game plan. Now more than ever, plan your trade and than trade your plan!

* Think money management, hedging risk while you are still trying to figure out how to profit.

* Know what is going on, reports, current margins, current limits and more.

Consider short term options instead of futures and/or MICROS

*Trade smaller. The bands are much larger. Watch the VIX.

* DO NOT assume anything…if you are not sure, contact us and we will try our best to assist with the combined, vast experience we have here as a team.

* Wash hands, take this seriously and do your best to stay healthy….

My colleague, John Thorpe, Ex floor broker, contributed the following on the VIX and the VVIX:

We recommend all stock indices intraday traders to keep an eye on the VIX for directional clues and study, many of you have access through other means to view this critical trading barometer, VIX now trades 5 days per week ,23 hours per day. if you need to add the VIX data to your trading platforms , it’s 3 bucks per month, penny wise and pound foolish if you don’t. Contact your broker on how to add the Volatility Index traded through the CBOE to your trading platform

Good Trading

Futures Trading Levels

12.05.2021

Futures Trading Support & Resistance Levels 12.05.2021

Weekly Levels

Futures Trading Support & Resistance Weekly Levels

Reports, First Notice (FN), Last trading (LT) Days for the Week:

https://mrci.com

Date Reports/Expiration Notice Dates

MRCI Reports

Risk & Trade Management in Volatile Markets, NQ Chart review & Support and Resistance Levels 12.01.2021

November 30th, 2021 Filed under Future Trading News, Index Futures, Indices | Comment (0)

Dear Futures Trader,

Get Real Time updates and more on our private FB group!

https://business.facebook.com/groups/1105191589938254/

On Friday, Omicron, the new COVID-19 variant took the oxygen out of newsrooms. Detected first in South Africa, this mutation is being described as potentially more contagious than the Delta variant. It is unknown whether the currently available vaccines will provide protection from it.

On Monday the markets shrugged the news and bounced hard….

Today, Tuesday fear, greed and everything in between took over again and we witnessed strong sell off across different markets with high volatility in many segments:

Stock indices, rates, grains, softs, energies…..

See 30 minute chart of the Mini NASDAQ from today below. In less than one hour, the difference from high to low was approximately $7750!! That is extreme leverage and can be a double edge sword…..This is when possibly trading smaller size, like 1-2 MICRO NQ may be a better fit for smaller accounts.

Risk management and trade management become more important than buy/sell signals.

Learn to reduce trading size. Perhaps trade smaller contracts like the micros.
Adjust stops and entries based on volatility ( ATR/ Parabolics).
Be extra picky on entries without chasing trades.
Understand that loses are part of trading and this is definitely not a good time to “fight the markets”.
Focus more on risk management and ways to protect certain positions as needed. Survive to trade another day.
Consider possibly utilizing short term options rather than futures.

Useful link, just in case – -Example, cotton was down limit today, only sellers, no buyers….:

https://www.cmegroup.com/trading/price-limits.html

Good Trading

Futures Trading Levels

12-01-2021

Economic Reports, source:

https://bettertrader.co/

Micro Mini NQ Chart Review / Fibonacci Extensions; Thanksgiving Holiday Schedule & Support and Resistance Levels 11.24.2021

November 23rd, 2021 Filed under Future Trading News, Index Futures | Comment (0)

Dear Futures Trader,

Get Real Time updates and more on our private FB group!

https://business.facebook.com/groups/1105191589938254/

An exercise in Fibonacci extensions….

As the NQ started moving lower today ( I actually prefer the MNQ as it causes less stomach ache when moves against me….), I was looking for a target profit on a short position a client of mine had.

I draw FIB extension for yesterday sell off move and applied it to the high on the bounce made early this morning….Today it turned out out to be an excellent tool (click for LARGER IMAGE)….gave me targets, possible trailing stops, possible re-entry and more ( always easier looking back after the fact)….Of course there are many times where this will NOT work but you may want to take a look at Fibonacci extensions as another tool in your arsenal and just Fibonacci retracement….

Short Trading week ahead with Thanksgiving Holiday this week.

See trading schedule below, be aware of the different reports, what is the market focusing on and the different closing times for the different markets between tomorrow and Friday/Sunday evening.