Day Trading in Futures Market

Holding either a long or short position in futures trading is the general phenomenon, however, the practice to buy and sell futures contracts on the same day is referred to as Day Trading. Such trading actions enable you to be free of having open positions at the end of the day.

Requisites for Day Trading

Day trading is a fast paced activity, which involves you to make quick decisions and expertise to make such decisions. Let's look into various essentials of day trading:

• Experience and understanding of futures market : Years of experience in futures trading and consequently gained expertise in analyzing market trends plays a vital role for success in day trading. Constant research, being abreast with financial happenings around the world can help you gauge sentiment in the market and frame your strategies.

• Financial resources : If you have enough leverage to access sufficient capital and good trading experience, you stand a good chance to make profits with smaller trades.

• Sound trading plan : As required for long term investment, day trading also requires strategies to capitalize on the market movements.

• Disciplined approach : Set your risk capital and make your moves with prudence. Impulsive decisions often end up unproductive.

• Technological tools : Tools viz., analytical software along with basic PC and internet are very useful in day trading.

With no open positions held overnight, day trading protects you against the unexpected losses at the opening of next day trade. However, day traders tend to over trade at times and run into financial troubles. Commissions are also high in day trading and hence, make prudent decisions in day trading to maximize your profits.

E-mini S&P 500 is the popular day trading market, where futures are electronically traded enabling quick execution of orders. E-mini Nasdaq futures, E-mini Russell futures, Dow futures are other markets. Commodities with high trading activity in day trading are soybeans, crude oil, 10 year T-Notes, Euro Fx.

Analyze the commodity, market well and with disciplined approach you can make good profits in day trading.



Many strategies in futures trading offer huge profit making prospects, however guidance of an experienced futures broker is immensely valuable.