Here’s how you can use your futures day trading account to make an absolute killing on the market. I call this my “magic number.” This number (the amount you should put into your futures trading account to start) will produce some absolute killer returns. It’s not a “rule,” it’s just a simple way of telling yourself what to look for in a trade. Using this information, you’ll be able to make a good estimate of the amount you want to invest in the market, which you then can place an order to buy or sell based on the market’s direction. Here’s how you do it.
When you start day trading, you want to find someone who has a good understanding of the futures markets. Your broker doesn’t have to be a financial wizard. You can check with your financial advisor, if you’re on a good one, or simply do a quick web search for a list of respected, experienced brokers. After you’ve done that, narrow down your list to a few possibilities. Then find out as much as you can about each potential brokerage.
One of the most important aspects of day trading is investing in a wide variety of products. That way, your arsenal of strategies will be extensive. If you focus on one commodity, for example, you’ll find that your strategies become a lot more effective. So, find a broker who can provide you with several commodity-trading strategies, such as those tied to: corn futures, cotton futures, wheat futures, gold futures, metal futures, soy futures, natural gas futures, silver futures, oil futures, gasoline futures, aluminum futures, copper futures and several others.
Don’t jump in right away. This is where most people start day trading the futures market. The more experience you gain, the less dependent you’ll become on your broker, since you’ll have a better idea about how to interpret the price movements of the futures contracts you buy and sell.
As you become more experienced, you may also wish to consider using a technical analysis tool to help you analyze the market. There are many different types of technical analysis software available on the internet, including those designed by professional traders. These tools analyze the way that the markets have moved in the past, what they will do in the future, and which factors are influencing the markets. Some of these tools are actually updated daily, while others are based only on the past prices of the particular asset being analyzed.
You should have a margin account. This type of trading account gives you the right to purchase and sell futures contracts on your broker’s platform. With a margin account, you have the option of increasing your deposit at anytime. If you increase your deposit, then you will be able to increase your leverage, which means that you’ll be buying or selling a contract bigger than the amount of money you have in your trading account. Leverage not only increases your risk level, it also means that you can earn much more than you would trading on your own.
Some futures day traders choose not to use leverage. These traders instead have complete control over the money they invest. They follow a simple strategy: buy when the price moves up, sell when the price moves down. In order to determine which trades turn out to be profitable, they simply set their stop-loss markers and take no action until the price reaches or exceeds the stop-loss mark. If the price doesn’t break the marker, then they simply re-buy and re-sell the same contract, taking control of their capital. The advantage of this strategy is that there are very few risks involved, since there is no leverage involved.
Day trading forex strategies that use leverage can potentially put your account at risk if you are careless or don’t have thorough knowledge of how the market works. However, if you are careful and have a good strategy, the potential for loss is low. Forex strategies that use this strategy successfully may be profitable for even the most experienced traders, as long as they can stick with them and don’t let their emotions get the better of them. Once traders understand how the forex market works, they can develop a clear strategy and use their knowledge to their advantage.