Mini DAX Futures 2015/10/05 9:16 PM GMT 0 comments Tweet

Eurex Exchange will launch the Mini DAX Futures contract on 28 October 2015 in addition to the existing DAX Futures (FDAX). Its contract value is one fifth of the DAX Futures.

CBOE web site offers quite many and good tools for futures traders. Apart from quotes, news and education resources, there are trading simulators which could be used unlimited time with a free registration on the web site. As a novice futures trader, I've been demo-testing some of the futures brokers platforms; however they give only 14-day trial which is not enough and need to register again with a new email, while losing your previous history and so on. That is why, for educational purposes CBOE.com simulation trading tools are quite good. I've been using those resources for a couple of years while learning stock trading, options on stocks and now grain futures trading.

Currently, I am using a tool called Virtual Trade. Although, it is very simplified and it will not show in full depth especially for a day trader every aspect of day trading; it is good for a start understanding futures trading basics and specifications. It has no charting; however I am using other charting websites while placing/closing orders.  On the other hand, it is quite good for following and keeping a track of your trades. 

Day-trading setup 2015/06/01 3:03 PM GMT 0 comments Tweet

Ichimoku cloud - trend
Parabolic SAR - trend
Stochastic RSI - looking for cross as for trend reversal where to exit - take profit/loss

Fundamentals play a quite big role in grain futures trading; US soybeans futures trended lower today and hit five-month low on fading demand for US soy on news of better yields after expanding harvest in South America. Corn and wheat traded lower today too trending down during the whole day on poor demand for US export of both commodities.

According to analysts these three grains will continue decline until USDA report in the end of this month when we will see planting intentions for the next season which to hint on future production and supply.

Grain futures basics 2015/03/15 12:36 PM GMT 0 comments Tweet

It's been already a week since I dived into the world of grain futures. Indeed, it's been good to have a week off from indexes trading and have a look at commodities. It's quite different angle, quite different market.

Comparing to indexes, agricultural commodity markets tend to be less volatile, speaking intraday, and less noisy which means that grain markets lack those false moves that are present at the stock market and once intraday trend established it would keep direction in most of the cases. Another distinction would be the limit moves - as the grain markets are also food markets there is a certain regulation that prevents large moves outside pre-specified interval. This could be considered as some regulatory stop-loss price above or below which during a day session the price won't be allowed to move further. In grain markets, we have corn, wheat and soybeans. The limit for the corn is 30 cents, for the wheat is 45 and for the soybeans - 70 cents from the settlement price of the previous trading day. From here we see that the the volatility and volumes could be placed in the same sequence - the corn is less volatile, the soybeans tend to be most volatile while the wheat is in-between.

Okay, now some specifications. The grains are being traded at CBOT and the pit trading hours are from 9:30 a.m. to 1:15 p.m. central time while the electronic trading hours are from 6:32 p.m. to 6:00 a.m. The volumes and all the action is at pit session so for day trading it is recommended to trade during the pit session. Another interesting and appealing thing is that the day trading session is much shorter than other markets'. Personally, it appeals to me quite a lot as I have some time for preparing for the trading day before open as well as once market close there is also time to evaluate your trades, go through the passed session and start preparing for the next day.

The grains are quoted in cents, one quarter cent move in AGs equals to $12.50 or one cent move - $50. It's very similar to ES-minis. The symbols would be - ZC for corn, ZW for wheat and ZS for soybeans. The futures trading months would be as follows:
-Corn: Jul, Sep, Dec, Mar, May
-Wheat: Jul, Sep, Dec, Mar, May
-Soybeans: Jul, Aug, Sep, Nov, Jan, Mar, May
The futures expire on the 15th of the trading month. Today is March 15th which means that March 2015 futures have already expired. Generally, we trade the front month.

To sum it up, AG grain futures market is very appealing and interesting market that too can be day traded. The trading session is shorter while the AGs tend to trend without significant and unnecessary noise. I am in the very beginning of grain futures universe and I plan to go deeper in some day trading set-ups next as well as read and study more on fundamentals that drive AG markets.

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