3 Practical Futures Trading Strategies still working in 2021

Cornerstones for your Futures Trading Strategies

When you have a futures contract, you agree to buy or sell a particular financial instrument or commodity sometime in the future at a price you agree upon when you make the contract.

The contract guarantees the exact date it will mature and the price the asset will be on that date. The contract also guarantees the amount and condition of the asset you are buying or selling.

Futures contracts may involve delivering the assets, but day traders often use the contracts to guard against risk or as future trading strategies.

If you are a new trader, you should be wise about certain things when you learn how to trade futures.

Risk Management Strategies in Day Trading

Holding Positions Until the Next Day is Risky

Also called going long on futures, holding positions overnight can possibly cause you to lose money. The futures may close at the end of the day at one price and open the next day at a much different price.

Day traders who close out their positions every day do not have to worry about losing money when the market opens in the morning. this method is a very important trading strategy.

Learning Day Trading Takes Longer- Learning Curve

It takes time to learn about future trading strategies in day trading. Position traders may make only one trade every week, but day traders often make many trades every day.
The number of times you enter into trades each day makes it harder to learn what you need to know about day trading.

Choose a Liquid Market in Which to Trade

Many day traders like to use the E-mini S&P 500 market for trading futures. Because the trading in that market is electronic, the E-mini S&P has the advantage of offering transactions that are very fast and liquid. E-mini Nasdaq futures, E-mini Russell futures and Dow futures are some of the other markets, and each market has different features.

Before you start day trading futures, you should learn about the details of each market so you can make the best choice (our Wiki can help you). Also another powerful trading strategy.

You need to be well trained and careful to be successful at day trading futures. When new traders start to learn more and gain some experience, it is easy to make mistakes that can cause problems and cost too much money.

Some of those mistakes include making risky trades and trading more than you can afford. You should be cautious and organized to succeed at trading. You must also remember that the cost of trade commissions will take part of the profits you make in day trading.

Do not forget to use these 3 trading strategies on your next trade!

See How to Trade Futures using Futures Trading System for your next steps.

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 External useful resources

  • Trading Strategies for Crude Futures - Zacks
  • Popular Commodity Option Trading Strategies - Carley Garner

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