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Learn To Trade The Futures Markets
Trading the futures markets is very similar from a chart standpoint as buying and selling the stock market. The main difference is the futures markets are inherently leveraged (small amount of funds controls a relatively large investment). Even if you use margin on trading stocks, traders do not approach the leverage of the futures. This is what makes the futures markets appealing as a day trading vehicle, or as a swing trading vehicle. Rarely do people invest in futures for the long term - at most the trade might be a handful of months.
If all you want to do is day trade, then the futures markets ought to be on your list to trade. If you have the SEC needed $25000 minimum to day trade stocks, then you can easily day trade the futures markets at the same time by opening a futures account. There is generally a bit more volatility day trading in the futures markets than in the stock market, and this can offer some great opportunities. Most futures companies will require you to put up about $5000 in order to open an account, certain brokers might be higher. Intraday margins to trade a contract or 2 are usually much less than the overnight margin requirements. This is because overnight there can be large gaps in price caused by news events and an individual is required to keep enough money in your account to deal with that level of volatility. Additionally, it will be possible if you hold futures overnight (or even intraday if you tend not to employ stops) to have your account go into a negative balance due to the leverage. will in no way let this happen and will close out all your positions before this happens. This type of event is plausible and the risks should be understood. Intraday it is rare, but overnight it can happen with higher odds.
While these dangers should not be downplayed, they should not stop you from trading futures either if you are a day trader. From a technical standpoint, trading futures is similar to day trading the stock markets, with the exception that there are no "news events" on the futures such as analyst upgrades or downgrades to be worried about. Economic events and news items happen daily, and these affect both index futures and stocks who trade off them, so this is nothing new. There are many websites now where you can get a cost-free demo account to practice day trading the futures markets. If you find that you like doing it, consider adding the futures markets to your current trading.
The futures markets work very well for testing out a day trading robot, because there is more volatility. The futures are often a great choice for any type 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 do not have this big a run, although they do trend up and down over months of time.
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