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Strategies & Market Trends : ajtj's Post-Lobotomy Market Charts and Thoughts -- Ignore unavailable to you. Want to Upgrade?

To: kimberley who wrote (57693)	4/22/2022 6:08:51 PM
From: rimshot	1 Recommendation Recommended By ajtj99 Read Replies (1) \| Respond to of 97611

keeping my answer as simple as possible: the Bid - Ask spread each moment on SPY and QQQ shares is far less in size than the Bid - Ask spread which is set by default at a fixed amount in accordance with the CME design for the /ES and /NQ futures when comparing options trading liquidity to trading similar buying power exposure using futures, you likely fare better using options depending on your buying power size I am headed outside now with our dog, will check back later if further questions

To: kimberley who wrote (57693)	4/22/2022 6:14:24 PM
From: Qone0	2 Recommendations Recommended By ajtj99 kimberley Respond to of 97611

Scott has a free trial, it's either two weeks or a month. I never did it so I'm not sure. Take it for a test drive. click on Ninja trader 8 install and request trial. Then you will know. sr-analyst.com

To: kimberley who wrote (57693)	4/23/2022 3:12:03 AM
From: Libbyt	2 Recommendations Recommended By ajtj99 kimberley Read Replies (1) \| Respond to of 97611

IMO rimshot had a very good recommendation to talk to several people about their experiences of trading futures. Years ago I asked someone on SI to explain futures trading to me….not because I wanted to trade futures but because I wanted to understand the process. My conclusion at the time was that trading futures was risky, and that you had the chance to do very well or have a trade go against you fairly quickly. The hours for some futures trading are different than the hours for the stock market, and some futures I believe trade 24 hours. investopedia.com From an article Options versus Futures: What’s the Difference “Futures Options may be risky, but futures are riskier for the individual investor. Futures contracts involve maximum liability to both the buyer and the seller. As the underlying stock price moves, either party to the agreement may have to deposit more money into their trading accounts to fulfill a daily obligation. This is because gains on futures positions are automatically marked to market daily, meaning the change in the value of the positions, up or down, is transferred to the futures accounts of the parties at the end of every trading day. Futures contracts tend to be for large amounts of money. The obligation to sell or buy at a given price makes futures riskier by their nature.”

To: kimberley who wrote (57693)	4/23/2022 9:23:14 AM
From: Sun Tzu	3 Recommendations Recommended By ajtj99 kimberley Mevis Read Replies (2) \| Respond to of 97611

Trading futures is not that different than trading anything else, but there are a few caveats: (1) Understand your contract. You know how oil went negative in 2020? That is because a bunch of n00bs did not understand that the oil contract delivery date (i.e. when you have to take possession) was different than the expiry date. So they ended up with commitments that they could not handle. (2) What moves the contract is different. Regular stocks usually move in response to the earnings and industry news. The futures move based on macro news or the weather or inventory data (depending on what you are trading). Currency futures have peculiarities of their own. (3) Algorithms dominate that market. This is more pronounced in the after hours. (4) There are patterns based on the time of the day. Like the tide patterns of the sea, each day is different but the pattern is there. You can make and lose a fair bit of money just based on these patterns. In short "futures" are not one thing. Every contract is different both in its requirements and its patterns. Choose one and get good at it before branching out. I don't think that the futures trading is any riskier than any other margin trading. Just because you can use the margin doesn't mean you have to (or should). Always leave yourself a fair margin and don't overextend yourself. I also don't think that a 24 hour contracts are a bad thing. Many people see it as a positive because they are not stuck with a close-to-open risk. You can change your mind as events materialize rather than face big gaps in the morning. Excessive margin is what kills you, not the other stuff. I recommend that you spend a month paper trading. I also found it very informative when I spent a couple of weeks pulling all nighters to understand the intraday patterns and algorithmic trades.

To: kimberley who wrote (57693)	4/23/2022 1:24:09 PM
From: Sun Tzu	2 Recommendations Recommended By ajtj99 kimberley Read Replies (1) \| Respond to of 97611

A couple of other things that I forgot to mention: Most of the index futures gains happen overnight. Which is why I spent time understanding the overnight market. In many ways trading the futures during the after hours is easier than during the regular hours. Just know that when viewed under short timeframes, the AH index futures are a very different animal during AH than during the day time. Depending on what timeframe you choose and what you are trading, there are some insights that only apply to the futures trades. By keeping track of the volume vs open contracts, you can figure out if a rally is driven by short covering or increases in long positions. There are also other insights to be gained based on contango/backwardation and the smile. I don't think these topics will matter much to you if you are focused on intraday index futures trades. They will matter if you are swinging commodities.