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Why Trading Sessions Matter in Forex: Key OverlapsThe Forex market is open 24 hours a day during the weekdays, allowing traders flexibility to trade at any time. However, understanding the best times to trade is essential for effective trading. The market is divided into four main sessions: Sydney, Tokyo, London, and New York, each corresponding to peak activity in key financial centers. Using a Forex Market Time Zone Converter can help traders determine which sessions are active in their local time, making it easier to plan around high-liquidity periods. Although the market is technically always open, not all trading times are equally profitable. Higher trading volume, which generally occurs during session overlaps, creates ideal conditions for traders. For example, the overlap of the London and New York sessions sees the highest volume, with more than 50% of daily trades occurring in these two centers. Trading at this time, especially with currency pairs like GBP/USD, can lead to tighter spreads and quicker order execution, reducing slippage and increasing the likelihood of profitable trades. Similarly, trading AUD/JPY during the Asian session, when the Tokyo market is active, is advantageous due to higher trading activity for these currencies. Conversely, trading during times when only one session is active, such as during the Sydney session alone, can result in wider spreads and less market movement, making it harder to achieve profitable trades. Planning trades around high-activity sessions and overlaps is key to effective forex trading.
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Education
by habib75rajabi
9
Options Blueprint Series: Calendar Spreads - Timing the MarketIntroduction to Calendar Spreads Calendar spreads, also known as time spreads or horizontal spreads, are advanced options strategies that involve buying and selling two options contracts on the same underlying asset, such as the S&P 500 Futures, but with different expiration dates. The strategy aims to profit from the differing time decay rates of the short-term and long-term options. Traders often deploy calendar spreads to capitalize on expected stable or sideways market conditions. Why S&P 500 Futures Options for Calendar Spreads? The S&P 500 index, encapsulating the performance of 500 of the largest companies listed on stock exchanges in the United States, serves as a premier gauge of U.S. equities. Its derivative products, notably the S&P 500 Futures Options, present traders with a fertile ground for executing calendar spread strategies. These options inherit the index's broad market exposure and liquidity, making them an ideal candidate for such strategies. Let's delve into the contract specifications and characteristics that make S&P 500 Futures Options and Micro Options particularly suited for calendar spreads. Contract Specifications: S&P 500 Futures Options (Standard): These contracts are based on the E-mini S&P 500 futures. Each contract represents an agreement to buy or sell the futures contract at a set price before the option expires. The standard option contract size typically mirrors the underlying futures contract, which is valued at $50 x S&P 500 Index. Micro S&P 500 Futures Options: Introduced as a more accessible variant, Micro S&P 500 Futures Options are 1/10th the size of their standard counterparts. This smaller contract size reduces the capital requirement, making it more appealing for individual traders and those looking to fine-tune their market exposure. The contract size for Micro Options is $5 x S&P 500 Index, maintaining the leverage and flexibility of the standard options but at a scale more manageable for a wider range of investors. Characteristics Beneficial for Calendar Spreads: Liquidity: Both standard and micro contracts benefit from high liquidity, ensuring tight bid-ask spreads. This liquidity facilitates easier entry and exit from positions, a critical factor when managing calendar spreads that require precision in timing and the ability to adjust positions quickly in response to market movements. Volatility Patterns: Understanding and anticipating volatility patterns is crucial for the success of calendar spreads. The S&P 500's inherent volatility, influenced by economic indicators, corporate earnings, and geopolitical events, can affect options pricing and the optimal structuring of calendar spreads. Strategic Flexibility: The availability of both standard and micro contract sizes provides traders with flexibility in managing their market exposure and tailoring their strategies to match their risk appetite and investment goals. Incorporating S&P 500 Futures Options into calendar spread strategies not only leverages these inherent characteristics but also taps into the dynamic interplay of time decay and market movements. Traders must, however, remain vigilant of the underlying market conditions and adapt their strategies to align with evolving market dynamics. Constructing a Calendar Spread To construct a calendar spread with S&P 500 Futures Options, a trader needs to undertake a series of thoughtful steps. Initially, one must select an appropriate strike price that aligns with their market outlook. Typically, at-the-money (ATM) or slightly out-of-the-money (OTM) options are preferred due to their sensitivity to time decay, which is a pivotal component of this strategy. Example Setup: Buying a Long-term Option: Consider purchasing a long-term put option on the S&P 500 Futures with an expiration date 30 days from now. The selection of a long-term option is strategic, as it retains its time value better compared to shorter-term options. Selling a Short-term Option: Simultaneously, sell a short-term put option on the S&P 500 Futures with the same strike price as the long-term call but with an expiration date 5 days away. This option is expected to lose time value rapidly, which is beneficial for the seller. As seen on the below screenshot, we are using the CME Options Calculator in order to generate fair value prices and Greeks for any options on futures contracts. Underlying Asset: S&P 500 Futures (Symbol: ES1! or MES1!) Strategy Setup: o Buy 1 OTM put option with a strike price of 5260 (Cost: 44.97) o Sell 1 OTM put options with a strike price of 5260 (Credit: 7.78) Net Debit: 37.19 (44.97 – 7.78) Maximum Profit: Achieved if prices are at 5260 at expiration. Maximum Risk: Limited to the net debit of 37.19. The essence of this setup lies in capitalizing on the accelerated time decay of the short-term sold option relative to the slower decay of the long-term bought option. Ideally, the underlying asset's price will be close to the strike price at the short option's expiration, maximizing the profit from its time decay while still benefiting from the long-term option's retained value. Adjustments for Market Movements: f the market moves significantly, the spread can be adjusted by rolling the short-term option forward to the next month, potentially locking in gains or reducing losses. A successful calendar spread hinges on precise timing and a keen understanding of volatility. The trader must monitor the implied volatility of the options, as an increase in volatility can enhance the spread's value, while a decrease can diminish it. Potential Market Scenarios and Responses Optimal Market Condition : The calendar spread thrives in a market exhibiting minimal price movement, particularly around the strike price of the options involved in the spread. This stability allows the trader to exploit the differential time decay effectively. Market Moves Against the Position : In the event of adverse market movements, the trader might need to adjust the strategy. This could involve rolling the short option to a different strike or expiration date, or possibly closing the position early to mitigate losses. Flexibility and proactive risk management are paramount, as market conditions can change rapidly. The construction and management of a calendar spread with S&P 500 Futures Options involve a delicate balance of market prediction, timing, and risk management. By judiciously selecting strike prices, expiration dates, and adjusting in response to market movements, traders can navigate the complexities of calendar spreads to seek profit from the nuances of time decay and implied volatility in the options market. Risk Management Effective risk management is crucial when trading calendar spreads, particularly with S&P 500 Futures Options, due to the potential for rapid changes in market conditions. Identifying and mitigating potential losses involve several strategies: Position Sizing: Keeping each trade to a reasonable proportion of the total portfolio reduces the impact of any single trade's loss. Diversification across different strategies and assets can also help manage systemic risks. Stop-Loss Orders: Implementing stop-loss orders for the position can help limit losses. This is especially important if the market moves sharply in an unexpected direction, affecting the spread unfavorably. Continuous Monitoring and Adjustments: The calendar spread requires regular monitoring and potential adjustments to respond to changes in the underlying asset's price or volatility. This may involve rolling out the short position to a further expiration date or adjusting strike prices to better align with the market conditions. Hedging: In some scenarios, traders might consider using additional options strategies or the underlying futures contracts themselves to hedge against significant market moves. This approach can help protect the portfolio from large, unexpected shifts in the market. Conclusion Calendar spreads offer a sophisticated strategy for traders looking to profit from the nuances of time decay and volatility in the options market, particularly with S&P 500 Futures Options. This strategy suits those with a nuanced understanding of market movements and the patience to monitor and adjust their positions over time. While calendar spreads can offer attractive opportunities for profit, especially in sideways markets, they also require diligent risk management and an active trading approach. Encouraging further education and risk-aware trading practices is essential for success in options trading. Traders should continually seek to expand their knowledge of market conditions, options strategies, and risk management techniques to refine their trading approach and better navigate the complexities of the financial markets. By embracing a disciplined approach to trading calendar spreads, investors can explore the potential of this strategy to enhance their trading arsenal, leveraging the dynamic nature of S&P 500 Futures Options to tap into market opportunities while managing the inherent risks of options trading.   When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies. General Disclaimer: The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
CME_MINI:ES1!Education
by traddictiv
Gold to $2057 overnight by 6:15am in the morning 1.04.24Gold should start its climb up to $2057 tonight . There should be on last push to 2048-49 then it should start its climb to $2057. Nothing really super technical here. It finished accumulation, then re-accumulation, made a control box, broke out. ran up. Dropped back to the zone to find support and resupply. Pushed a little deeper, and now setting up to break that high using the measurements it made doing everything I just said. Which points to the $2057 area and Im throwing in some timing to make it interesting.... I have a natural rhythm to the market and with that it should finish before 6:15am. just a zone break, followed by a pull back to support and then a launch for profits.
COMEX:GC1!Long
by iCantw84it
The Element of Time - The Most Underrate Technical Analysis ToolMarket timing is an essential tool whether you're a day-trader, portfolio manager and/or long-term investor. I present to you the most underrated technical analysis tool in the space of retail trading. The purpose of this short educational webinar is to open your eyes to something you don't hear about abundantly because it is the most disregarded aspect of trading in my opinion. As an intraday trader, my main focus is on the speculation of "the next daily candle". However, I first analyze and project on "the next weekly candle". Each weekly candle is broken into 5 individual daily candles, and each daily candle is broken down into 3 main market sessions - namely, Asia, London & New York Session. You'll find that my main focus in this lesson is on the day in which you find a lower / upper wick being created on the weekly candle. More often than not, "Tuesday" typically forms the low of a bullish weekly candle, and the high of a bearish weekly candle. Watch the lesson entirely, take notes, but most importantly, let it open up the opportunity for you to exponentially elevate your trading skillset.
Education
by Maroun4x
9
The Most Underrated Technical Analysis Tool - Element of Time !Market timing is an essential tool whether you're a day-trader, portfolio manager and/or long-term investor. I present to you the most underrated technical analysis tool in the space of retail trading. The purpose of this short educational webinar is to open your eyes to something you don't hear about abundantly because it is the most disregarded aspect of trading in my opinion. As an intraday trader, my main focus is on the speculation of "the next daily candle". However, I first analyze and project on "the next weekly candle". Each weekly candle is broken into 5 individual daily candles, and each daily candle is broken down into 3 main market sessions - namely, Asia, London & New York Session. You'll find that my main focus in this lesson is on the day in which you find a lower / upper wick being created on the weekly candle. More often than not, "Tuesday" typically forms the low of a bullish weekly candle, and the high of a bearish weekly candle. I encourage you to mark out the Open of your week, and highlight the swing point on the Tuesday of each week. I promise, you'll start implementing the "Element of Time" in your trading toolbox. Of course this is not a standalone tool, however is helps greatly with the determination of your weekly directional bias. It will also assist with your trade and risk management. It is to up to you to put the work in and infer whatever information you can from this little teaser of an illustration. Let this open up the opportunity for you to exponentially elevate your trading skillset.
Education
by Maroun4x
9
The Most Powerful Market Timing TechniqueI'll start off this post with a simple question: why do market technicians place such importance on "confirming" particular areas in a chart? To answer this, we must first understand what confirmation is and what its purpose is. As simply as I can describe it, a confirmation is a technical process of elimination. That is, one can confirm a directional price change in trend by confirming that a continuation (at least immediately, relative to the time frame examined), is a technical impossibility. Through many hours of cumulative human observation, we have been able to derive rules that the market follows unconditionally. These types of absolute rules are few and far between, but knowledge of them is critical to swing trading pivot highs and lows, as well as a basis for having confidence in timing the market. And that last piece is what confirmations are all about: they provide the swing trader with enough confidence to risk his or her monetary life without batting an eye in real time. To catch a major peak or trough within pips of the true high or low (especially in today's leveraged markets) is not only immensely difficult but is also a psychologically torturous undertaking. The outcome of success is immense wealth accumulation in a matter of minutes; no other platform exists in this world where one can turn their life around in such a short amount of time without it being a function of pure chance gambling (like the lottery). In fact, if one can master the art of confirmation (which is to say that one can implement techniques like the monthly time cycle convergence displayed above), then it becomes possible for one to be nearly certain of achieving the highest form of monetary return that is offered in all of financial markets. I would say that a situation like the one we have here and presented above, offers at least a 90% chance of success; insofar as one can succeed in using short-term options leverage to catch the top or bottom of a major turn and yield something in the ballpark of 10,000% return in a week. At the very least, I'd say that the probabilities are such that the techniques are worth serious examination from serious investors with serious amounts of risk capital. So now that we've covered what confirmations are and how they can be of enormous assistance to the patient swing trader, I'd like to discuss this so-called "Most Powerful Confirmation in Technical Analysis." The technique is a simple trial-and-error test of a particular time period that is surmised to contain a "significant" sub-period of time that serves as a major turning point in markets. For example, my hypothesis is that December of 2021 contains a sub-window of time within the monthly time interval that contains the all-time high price in the S&P 500. My initial reasoning is unimportant; the point is that I have a hypothesis of a major directional change in markets and I want to confirm it as much as possible before I seriously consider acting on it. Thus, I will first look to prior major peaks and troughs over the last 20ish years (Cycle, or Supercycle, in Elliott Wave Terms), and measure the number of months in between these points and the current month to see if there are any numerically-significant matches on at least three of them. What do I mean by numerical significance? I mean that it is an observed fact that there exist certain additive sequences (like the Fibonacci Sequence) that ultimately dictate all price movements in free markets. I will not discuss the myriad sources and hypotheses that propose reasons for why this is; I am going to assume that the collective literature is proof enough of its apparent existence. In any case, my goal is to measure the number of months back to each major high or low and see if numbers like "21, 144, 233, 377, etc." come up in these measurements, and if so, how many of them are there? In addition to fibonacci-number monthly counts are "natural roots and squares," whereby a monthly count is a number that can be perfectly squared or rooted to a whole integer. Further, if the root or square is geometrically significant (i.e. a multiple of 2, 3, or 5), then it may serve as a double-confirmed count and provide the swing trader with even more confidence to pursue his swing conviction. Lastly, if the monthly count on any historically significant peak or trough point in time is a natural root or square, is geometrically significant, AND IS ALSO a Fibonacci number, then you have a triple-confirmed count and even more certainty that the month under examination is a future cash-cow. An example of a triple-confirmed count is 144 months back because 144 is 11th fibonacci number, is also the natural square of 12, and 12 is of geometric significance because of its additive/multiplicative relationship with 3 and the root of 3 (which derives the mathematics of triangles and trines). To wrap this up, the chart above shows that EVERY MAJOR PEAK AND TROUGH over the past 20 or so years spins out monthly time counts of numbers that are categorically relevant to the aforementioned criteria. If I wanted to be even more precise than to say "December 2021 will contain the all-time pivot high," then I would conduct a similar analysis, but on a weekly timeframe using a lookback period of about 5 years. The peaks and troughs will be of one lower degree than those of the monthly analysis, but will similarly provide counts that all spin-out signficant numbers if the week that I am examining, is in fact, the correct week containing the major turn. I call this iterative process of trial-and-error "Time Period Convergence" as a general umbrella term for this all-powerful type of analysis. However, the sky is the limit in terms of precision and one could theoretically work his way down to the exact second of the major turn if one has already confirmed numerically-significant counts on the monthly, weekly, daily, hourly (most important for short-term swing trading, FYI), 30-minute, 15-minute, 5-minute, 1-minute and 30-second timeframes, as long as one has access to live data that can feed in such timeframes. Since I began with a simple question, I will leave you with a simple question: Do you think still think it's impossible to time markets? -Cyc-Pig-lycal Convergence SP:SPX NASDAQ:IXIC TVC:DJI TVC:RUT
SP:SPXEducation
by UnknownUnicorn5511258
5
See the Bubble - Clear as day ! S & P 500This is the long term weekly chart of the S & P 500. The green line is the long term 200 week moving average of the stock market over a long term time period. From this chart you can see how far the S & P 500 was over its 200 week price average in the Tech boom of the 1990's. You can also see the crash ! You can also see the housing bubble of 2008 and that crash. As you can see from this chart, prices are very very very high and in a clear and major bubble ! They have never been this far over the 200 week price average ever ! Don't look down ! Scary chart when prices are put into a perspective of history that can been seen. This is facts ,this can not be hidden or lied or politicly manipulated. This chart speaks the truth for all to see. Be carful out there. You have been warned. Follow me for more update in the future. Thank you
AMEX:SPY
by sky777666
3
2913 Bull/Bear Line--04/24 Weakness Date--Morning NotesHi Everyone, Quick Note: We are doing the co-marketing program with some other newsletters. If you are interested, there is no obligation at all-just register and you get all of the newsletters involved free-See link below in the signature section. It will help us out as well-so thanks in advance. G- Morning Notes 04/25/19 Trading Environment-Short Term: Current Environment-Neutral/Bearish Futures are looking like a turkey wishbone here, with the Dow down pretty hard, Nasdaq up pretty hard and the spx stuck nowhere. Not sure this will last the entire day, so expecting one side to win makes sense. Obviously the timing piece for weakness from 04/24 to 04/29 is suggesting the bears will win and the other indexes will follow the Dow, but we still need to see the bears break any support levels first, which they have failed every time. If we see the spx follow the Nasdaq near the open, I don't think it will last long. I mentioned yesterday that another higher high would set up divergences on the 60 minute charts and that still holds true, since no new highs were hit yesterday (/es) The short term pattern looks like a bull flag, which is suggesting we could get the final spike higher at some point, but again, I don't believe it will last long if that does take place. We have a defined range and whoever wins this battle, will win the short term direction. If the bears win, I wouldn't be surprised to see a larger break to the downside than if the bulls win and get a spike higher. This market looks exhausted here and can turn anytime and make sense. The range SPX range for today is 2934 high and 2926 low. A break of 2934 the spx should try for 2937/2942. A push below 2926 we could see 2913/2906. G SPX CASH 60 minute technicals Stochastics: Overbought Divergences- No Divergences Resistance Levels: R1-2934 R2-2937 R3 2942 Support Levels: S1-2926 S2-2913 S3 2906 Trending Pivots: Neutral
AMEX:SPYShort
by sentimenttiming
1
POTENTIAL LONG OPPORTUNITY ON USDCAD @1.3370 (CIRCLED AREA)Here is an opportunity to join in on the USDCAD multi-year rally or simply to add positions. The best time to add positions is when price pulls back to quality levels so that we are BUYING LOW or SELLING HIGH . Over the past few weeks, we have seen price recoil from that unbelievable rally and looking at price, it is likely to continue to 1.52! Bold call? Maybe. No one is ever 100% correct. So let us say this call is wrong, we can still control how much we lose. Also, there are money management tools we can use to ensure we get some profits if price goes our way but not ALL THE WAY. Entry Point : 1.3370 Stop Loss : 1.3220 Profit Target : 1.5120 Risk: 150 pips Reward: 1750 pips (>11x Risk) This is expected to be a long term position, taking weeks to reach the target. So, money management may be necessary. Because of the interest rates differences, you'd be paying a ROLLOVER fee for holding this long position! Money Management Enter multiple positions with various profit targets. Split your position into two. Set one profit target at 3:1. When the first half is closed, move the stop loss to break-even on the over half! and be risk free!
Long
by selfrighteousgambler