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Look At The Futures Market For Day Trading Ideas
Trading the global futures markets is much the same from a chart point of view as trading the stock market. The main discrepancy is the futures markets are inherently leveraged (small amount of capital controls a relatively large asset). Even if you use margin on trading stocks, you do not accomplish the leverage of the futures markets. This is what makes the futures markets desirable as a day trading vehicle, or as a swing trading vehicle. Rarely do traders invest in futures for the long term - at most the trade might be a few months.
If all you want to do is day trading, then the futures markets ought to be on your list to trade. If you have the SEC manditory $25000 minimum to day trade the stock market, then you can very easily day trade the futures markets as well by opening a futures account. There is generally slightly more volatility day trading in the futures markets than in the stock market, and this can offer some great opportunities. Most futures brokerages will require you to deposit about $5000 in order to open an account, some might be higher. Intraday required margin to trade a contract or 2 are usually much less than the overnight margin requirements. This is because overnight there can be significant gaps in price triggered by news events and an individual is required to hold enough money in their account to handle that level of volatility. Additionally, it will be possible if you hold futures positions overnight (or even intraday if you don't use stops) to have your account go into a debit balance because of the leverage. will by no means let this happen and will liquidate all your positions before this happens. This type of event is possible and the risks should be understood. Intra-day it is rare, but overnight it can happen with greater frequency.
While these risks should not be downplayed, they should not stop you from trading futures either if you are a day trader. From a technical point of view, futures trading is much the same to day trading stocks, with the exception that there are not any "news events" on the futures such as analyst upgrades or downgrades to worry about. Economic events and news items happen daily, and these affect both stocks and index futures who trade off them, so this is nothing new. There are many sites now where you can get a free demo account to practice day trading the futures markets. If you discover that you enjoy doing it, consider adding the futures markets to your current trading.
The futures markets work very well for testing out a day trading robot, simply because there is more volatility. The futures are often a better choice for any form of automated trading robot because they tend to be more range bound than stocks. While an individual stock can run from 10 to 200 in a few months, the futures markets never have this big a run, although they do trend up and down over months of time.
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