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The Futures Leap

Nasdaq Leading Equities HigherThe equity markets are seeing higher prices today with the Nasdaq leading the way higher trading up near 2.5% on the day while the S&P and Russell both traded over 1% as well. There was steep selling pressure in equities to end the week last Friday due to additional tensions in the Middle East, and the markets are seeing a strong rebound today, especially on the technology front. While the equities were strong today, Crude Oil had the opposite effect, with a strong push higher on Friday and strong selling pressure on the session today trading down near 2.5%. Looking ahead for the week, the big ticket item will be the Fed Meeting and interest rate decision on Wednesday the 18th, where the market is pricing in another pause on interest rates. Looking at the CME Fed Watch Tool, it is pricing in the first rate cut of the year to come in September at a 56% probability, which has continued to get pushed back later into the year with all of the uncertainty and volatility in the market. Traders will be more concerned with Fed Chair Powell’s remarks after the decision about the future plans of the Fed for the remainder of the year. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/ *CME Group futures are not suitable for all investors and involve the risk of loss. Copyright © 2023 CME Group Inc. **All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
CME_MINI:NQ1!
by CME_Group
1
What is Gold Silver Spread?What is gold silver spread? How to understand them to determine the market direction. Reuters mentioned that the gold-silver ratio dropped from 105 to 94. What does this mean? Does it indicate that silver is about to trend higher, or is it a sign that gold will continue its trend? Micro Silver Futures Ticker: SIL Minimum fluctuation: 0.005 per troy ounce = $5.00 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com Trading the Micro: www.cmegroup.com www.cmegroup.com
COMEX:GC1!Long
by konhow
Ether Leads Markets HigherThe crypto markets move to the upside continued in today's session, with Ether futures leading the way higher trading up over 8% while Bitcoin rose nearly 1.5%. There has been significant strength from the Crypto markets over the last few weeks, and Ether is now trading right near the 50% retracement mark from the December 2024 high price when looking at a daily chart. Along with Bitcoin and Ether, the Solana market also saw a sharp rise over 5% on the session while XRP saw slight losses. Outside of the Crypto markets, the Equity Indices traded slightly higher near 0.5% with Tesla leading the Nasdaq higher on the session. This is the third session in a row with a new higher high price for the S&P and could support a strong market at these levels. There have also been continued talks between President Trump and China about tariff policy, and the outcomes could add significant volatility to markets globally when resolved. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/ *CME Group futures are not suitable for all investors and involve the risk of loss. Copyright © 2023 CME Group Inc. **All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
CME_MINI:NQM2025
by CME_Group
Heatwaves and Wheat: How Temperature Shocks Hit Prices🌾 Section 1: The Wheat–Weather Connection—Or Is It? If there’s one crop whose success is often tied to the weather forecast, it’s wheat. Or so we thought. For decades, traders and analysts have sounded the alarm at the mere mention of a heatwave in key wheat-producing regions. The logic? Excessive heat during the growing season can impair wheat yields by disrupting pollination, shortening the grain-filling period, or damaging kernel development. A tightening supply should lead to price increases. Simple enough, right? But here’s where the story takes an unexpected turn. What happens when we actually analyze the data? Does heat reliably lead to price spikes in the wheat futures market? The short answer: not exactly. In fact, our statistical tests show that temperature may not have the consistent, directional impact on wheat prices that many traders believe it does. And that insight could change how you think about risk, seasonality, and the role of micro contracts in your wheat trading strategy. 📈 Section 2: The Economics of Wheat—And Its Role in the Futures Market Wheat isn’t just a breakfast staple—it’s the most widely grown crop in the world. It’s cultivated across North America, Europe, Russia, Ukraine, China, and India, making it a truly global commodity. Because wheat is produced and consumed everywhere, its futures markets reflect a wide array of influences: weather, geopolitics, global demand, and speculative positioning. The Chicago Board of Trade (CBOT), operated by CME Group, is the main venue for wheat futures trading. It offers two primary wheat contracts: Standard Wheat Futures (ZW) Contract Size: 5,000 bushels Tick Size: 1/4 cent per bushel (0.0025) has a $12.50 per tick impact Margin Requirement: Approx. $1,700 (subject to change) Micro Wheat Futures (MZW) Contract Size: 500 bushels (1/10th the size of the standard contract) Tick Size: 0.0050 per bushel has a $2.50 per tick impact Margin Requirement: Approx. $170 (subject to change) These micro contracts have transformed access to grain futures markets. Retail traders and smaller funds can now gain precise exposure to weather-driven moves in wheat without the capital intensity of the full-size contract. 🌡️ Section 3: Weather Normalization—A Smarter Way to Measure Impact When analyzing weather, using raw temperature values doesn’t paint the full picture. What’s hot in Canada might be normal in India. To fix this, we calculated temperature percentiles per location over 40+ years of historical weather data. This gave us three weekly categories: Below 25th Percentile (Low Temp Weeks) 25th to 75th Percentile (Normal Temp Weeks) Above 75th Percentile (High Temp Weeks) Using this approach, we grouped thousands of weeks of wheat futures data and examined how price returns behaved under each condition. This way, we could compare a “hot” week in Ukraine to a “hot” week in the U.S. Midwest—apples to apples. 🔄 Section 4: Data-Driven Temperature Categories and Wheat Returns To move beyond anecdotes and headlines, we then calculated weekly percent returns for wheat futures (ZW) for each of the three percentile-based categories. What we found was surprising. Despite common assumptions that hotter weeks push wheat prices higher, the average returns didn’t significantly increase during high-temperature periods. However, something else did: volatility. In high-temp weeks, prices swung more violently — up or down — creating wider return distributions. But the direction of these moves lacked consistency. Some heatwaves saw spikes, others fizzled. This insight matters. It means that extreme heat amplifies risk, even if it doesn't create a reliable directional bias. Traders should prepare for greater uncertainty during hot weeks — an environment where tools like micro wheat futures (MZW) are especially useful. These contracts let traders scale exposure and control risk in turbulent market conditions tied to unpredictable weather. 🔬 Section 5: Statistical Shock—The t-Test Revelation To confirm our findings, we ran two-sample t-tests comparing the returns during low vs. high temperature weeks. The goal? To test if the means of the two groups were statistically different. P-Value (Temp Impact on Wheat Returns): 0.354 (Not Significant) Conclusion: We cannot reject the hypothesis that average returns during low and high temp weeks are the same. This result is counterintuitive. It flies in the face of narratives we often hear during weather extremes. However, our volatility analysis (using boxplots) showed that variance in returns increases significantly during hotter weeks, making them less predictable and more dangerous for leveraged traders. 🧠 Section 6: What Traders Can Learn from This This analysis highlights a few key lessons: Narratives aren’t always backed by data. High heat doesn’t always mean high prices. Volatility increases during weather stress. That’s tradable, but not in the way many assume. Risk-adjusted exposure matters. Micro wheat futures (MZW) are ideal for navigating weather-driven uncertainty. Multi-factor analysis is essential. Weather alone doesn’t explain price behavior. Global supply chains, speculative flows, and other crops’ performance all play a role. This article is part of a growing series where we explore the relationship between weather and agricultural futures. From corn to soybeans to wheat, each crop tells a different story. Watch for the next release—we’ll be digging deeper into more effects and strategies traders can use to capitalize on weather. 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: tradingview.sweetlogin.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.
CBOT:ZW1!Education
by traddictiv
How to Identify Head and Shoulders?How to identify head and shoulders patterns? We’ll use the current example from the Nasdaq or the US markets. We can quite clearly observe that a potential head and shoulders formation is developing. This means that if the price breaks below the neckline, we may see a deeper correction from the April low. I will go through the rules on how to identify a head and shoulders formation. We will also cover how to recognize when the pattern is invalid — meaning the market may continue pushing above its all-time high. Finally, we’ll discuss how we can position ourselves early, before waiting for a break below the neckline for confirmation. Micro Nikkei Futures Ticker: MNQ Minimum fluctuation: 0.25 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com Trading the Micro: www.cmegroup.com www.cmegroup.com
CME_MINI:MNQ1!Short
by konhow
Russell Leads Equities HigherEquity markets saw a positive day today with the Russell leading the way higher being up over 1.5% on the session. For the S&P and Nasdaq, this was the third session in a row with a higher high, and the 200-day moving average has acted as a floor in these markets since the breakout higher on May 12th. CPI numbers came out for Europe and came in worse than expected, and then the JOLTs data released later in the day was a better than expected figure and equites saw prices rise throughout the day. Outside markets also saw movement today with Crude Oil strength continuing up over 1% on the session and closing out above the 50-day moving average for the July contract. The Crude Oil market has not seen the recovery that equities did from the breakdown in early April, and are still trading below the breakdown point. Along with Crude Oil, crypto futures had a strong day today, with XRP trading up over 4% and Solana and Ether both rising over 2.5% on the session. Tomorrow traders will get a look at ADP Nonfarm Employment Change along with manufacturing data before the critical jobs data at the end of the week. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/ *CME Group futures are not suitable for all investors and involve the risk of loss. Copyright © 2023 CME Group Inc. **All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
CME_MINI:RTY1!
by CME_Group
1
Precious Metals Leading Charge HigherStarting off the week today, traders are seeing many markets moving higher with the precious metals and energy markets leading the way. Gold futures over 2.5% on the session while Silver led the charge higher being up nearly 5%, and the Crude Oil market saw gains north of 3% while Natural Gas was up over 7% on the session. Equity markets traded slightly higher on the session but did not see the volatility seen in the precious metals or energy markets. Looking at the economic data today, there was a big slate of data coming out of the U.S. looking at ISM manufacturing and S&P Global manufacturing that came in worse than expected. Tomorrow, traders will get a look at CPI coming out of Europe and JOLTs data here in the U.S. that could add additional volatility to the precious metals for the rest of the week. Along with that, the CVOL for Silver still remains very wide as seen below, and looking back over the past year shows that the volatility is relatively low compared to the current underlying price even with the spike traders saw today. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/ *CME Group futures are not suitable for all investors and involve the risk of loss. Copyright © 2023 CME Group Inc. **All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
COMEX:SI1!
by CME_Group
Markets Lower Ahead of Nvidia Earnings Equity Indices traded loEquity Indices traded lower on the session today after seeing strong gains yesterday to start the week with the Russell leading the downside pressure being down near 1%. The FOMC minutes were released this afternoon and showed that the Fed was comfortable with rates remaining unchanged for the time being, and equity markets fell while traders saw Bond Yields trade higher. Gold, Silver and Copper also saw losses on the session with Copper leading the selling pressure being down near 1.5%. The big news today came after the bell with Nvidia reporting earnings, where they saw a beat on both EPS and Revenue, and the S&P and Nasdaq are seeing some after hours gains. There was news this afternoon as well where President Trump ordered US chip designers to stop selling software to China, which could have longer term effects on the global supply and demand. Looking ahead for the rest of the week, traders will see key economic data looking at jobs and GDP that can add volatility to the equity indices and outside markets like the precious metals or crypto markets. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/ *CME Group futures are not suitable for all investors and involve the risk of loss. Copyright © 2023 CME Group Inc. **All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
CME_MINI:ES1!
by CME_Group
Recap: Short below LIS/Yearly Open Crude OilNYMEX:CL1! Another day and EdgeClear brings you another recap where one of the highlighted scenarios in our weekly plan for WTI crude oil, published on February 24, 2025 , played out as expected. Our Scenario 3 looked at price discovery extending the 2025 range into Q4 2024 lower distribution. Our analysis indicated an initial move lower bouncing from CVPOC 2022 support. The key was price moving below key LIS/yearly open. We did not see a bearish head and shoulders pattern develop, however, the rest of the plan played out as expected. Note the price action till Friday, 28th Feb 2025. We have been consistently providing traders with a roadmap for WTI crude oil with our thoughts and opinions on the market. WTI crude oil is a fundamental product that is affected by several factors, such as: macro, geopolitical, economic, supply, demand, and oil production dynamics. Our analysis considers these developments along with auction market theory and key indicators that may be important to watch at times. As an example, for our January 13, 2025, blog , we noted increased volume with increased open interest that drove bullish sentiment in crude oil prices. We also highlighted potential short opportunities that played out per our plan. For last week’s blog, we noted the overall trend in volume and open interest falling, indicating a potential move lower. This combined with multiple tests of our key LIS/ yearly open, strengthened our thesis for further price discovery lower. In our blog, we have highlighted two key ranges: $70 - $75 - Q1 2025 Value Area $65 - $70 - Q4 2024 Lower Distribution Focus is shifting towards oil market fundamentals i.e., supply, demand, and production outlook. While headline news may drive short-term and intraday volatility, investors and market participant’s focus will shift towards oil market fundamentals. On March 3rd, 2025, OPEC+ reaffirmed its decision from December 5, 2024, to proceed with gradual and flexible return of 2.2 mbpd voluntary cuts, starting April 1, 2025. It provided a detailed table along with a cautious approach should this decision require any amendments. In our analysis, while trade war and tariff tantrum create uncertainty around demand outlook, any news providing clarity on tariffs will be considered net positive.
NYMEX:CL1!
by EdgeClear
US Market Reversal EmergedLast Friday marked the final trading day of February. I always take the opportunity to analyze the monthly chart closely. We saw an inverted hammer. From the cash chart, clearly, we can see the inverted hammer. Beyond that, it also appears to be a potential double top for the Nasdaq. E-mini Nasdaq Futures & Options Ticker: NQ Minimum fluctuation: 0.25 index points = $5.00 Micro E-mini Nasdaq Futures & Options Ticker: MNQ Minimum fluctuation: 0.25 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com Trading the Micro: www.cmegroup.com
CME_MINI:MNQ1!Short
by konhow
ES Futures & Macro Trends: Key Levels and Market ScenariosCME_MINI:ES1! Macro and Geopolitics: There was continued news flow over the weekend after derailed talks between Trump and Zelensky. Europe, UK and Saudi Arabia are still pushing for a Russia-US-Ukraine peace deal that will likely include rare earth minerals. We also heard Trump commenting on an executive order on digital assets strategic reserves helping reverse losses in CME BTC futures. Investors see this as a positive development prior to the upcoming Crypto Summit in Washington on March 7th. US March 4th tariff deadlines loom for Canada, Mexico, and China. Trump repeated America's first stance commenting that border security and stopping illegal drug trades should be America’s prime focus. Economic Calendar: Looking ahead this week, key economic events include manufacturing PMI data on Monday, employment and services data midweek, and major central bank decisions and labor market reports toward the end of the week. Here’s a breakdown of important releases: Monday: Manufacturing PMI data release Wednesday: ADP Nonfarm Employment Change Services PMI Crude Oil Inventories Thursday: European Central Bank (ECB): Interest rate decision & monetary policy statement U.S. Data: Weekly Initial Jobless Claims Continuing Jobless Claims U.S. Trade Balance January 2025 Imports & Exports data Friday: U.S. Employment Data: Nonfarm Payrolls (NFP) report Average Hourly Earnings Unemployment Rate Federal Reserve Speakers: Bowman & Powell scheduled to speak ES Big Picture: Despite increased volatility and risks mounting, looking at the daily chart shows that ES futures are still within range and trading above Nov 4th, 2024 and January 13th, 2025 low, however, 2025 mcVAH and R1 confluence has been acting as strong resistance and keeping the markets from reaching new all-time highs. Despite the risks, our analysis suggests that with the U.S. economy showing resilience, a "buy the dip" approach remains favorable. However, staying selective and strategic with opportunities is key to balancing risk and reward. Key Levels: Key levels represent areas of interest and zones of active market participation. The more significant a key level, the closer we monitor it for potential reactions and trade setups in alignment with our trading plan. 2025 VAH: 6,150 2025 VPOC: 6,133.75 LVN: 6,113.25 Neutral Zone: 6,000 - 6,015 2025 VAL: 5,972.50 LIS/Yearly Open: 5,949.50 Neutral Zone: 5,916.50 - 5,927.25 Feb 2025 Low: 5,848 Jan 2025 Low: 5,809 Scenario 1: Range bound week Market remains volatile, however, within the neutral zone below key LIS/yearly open and neutral zone above Key LIS/yearly open. Scenario 2: Weak data points slowing economy Worsening economic data points along with progress in Ukraine- US minerals deal points towards further buying. Weaker data points may provide room for further rate cuts should economic weakening further materialize. Scenario 3: Mounting risks and weaker economic data On the contrary, mounting risk and weaker economic data may point towards stagflation as inflation remains sticky while the economy weakens. This provides room for further decline in ES futures.
CME_MINI:ES1!
by EdgeClear
Consumer Sentiment & Stocks MarketsStock Markets Track Consumer Sentiment Closely The relationship between consumer sentiment and the stock market is evident in this observation. Historically, consumer sentiment tends to lead stock market movements, providing valuable insights into potential trends. Personally, I consider the Russell 2000 Index as a reflection of mass consumer sentiment, given that it tracks the 2,000 smallest publicly traded companies in the U.S. market. Looking at the E-Mini Russell futures, consumer sentiment peaked in December 2024, and since then, I have been monitoring the Russell and other indices along their well-supported trendlines. When the Russell started testing its trendline in January, I became cautious about its uptrend. The clean break on February 21 signaled a shift: Russell transitioned from an uptrend to a downtrend on the daily chart. Consequently, my trading strategy has shifted from buying on dips to selling on strength whenever opportunities arise. Russell is Leading Dow Jones, Nasdaq and S&P??? Indices tend to influence each other, and leadership often rotates. While the Nasdaq has previously led market moves, this case study suggests Russell is currently taking the lead. Technically, the overall U.S. market remains bullish as long as it holds above the primary uptrend line. A bear market is typically confirmed when the market drops 30%, and by then, it should break below all primary uptrend lines. However, waiting for that confirmation is too late—by then, the damage will be significant. The key observation is that Russell has already broken its secondary uptrend line. Will the Dow Jones, S&P 500, and Nasdaq follow? If so, we need to make fundamental projections. Factors like escalating tariff conflicts could worsen inflation, directly impacting the broader stock market and indices. Consumer Sentiment Still Below 80 Despite Pandemic Being Long Over Given the current macro environment, consumer sentiment is likely to remain below 80 for an extended period. Additionally, there is a downside risk if geopolitical tensions escalate. From past case studies, a consumer sentiment reading below 80 has often preceded a stock market decline. This historical pattern raises concerns about future market stability. My Trading Strategy: Cautiously Bullish • Technical Perspective: Apart from Russell, I remain bullish on other indices. • Fundamental Perspective: Market sentiment leans toward pessimism. • Conclusion: This dual outlook leads me to a cautiously bullish stance. For Russell 2000, my preferred strategy is to sell into strength, guided by a downtrend channel. Another alternative is trading Micro E-Mini Russell futures (M2K) for precision and risk management. 📈 Happy trading! Please see the following disclaimer and additional information that may be useful. E-mini Russell Futures Ticker: RTY Minimum fluctuation: 0.10 index points = $5.00 Micro E-mini Russell Futures Ticker: M2K Minimum fluctuation: 0.10 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • My mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. Trading the Micro: www.cmegroup.com CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com
CME_MINI:RTY1!Short
by konhow
2
Timing the Markets with Consumer SentimentBusinesses and producers around the world always cheer when U.S. consumer sentiment is in the 80 to 100 zone, as U.S. consumers play a big part in the global economic ecosystem. The United States remains the largest consumer market in the world, but since the pandemic, this index has not recovered above the 80 level. Does it mean that, there is a risks economy to enter into a recession? How can we use this index to time our investments and trades? E-mini Russell Futures Ticker: RTY Minimum fluctuation: 0.10 index points = $5.00 Micro E-mini Russell Futures Ticker: M2K Minimum fluctuation: 0.10 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. Trading competition: tradingview.sweetlogin.com Trading the Micro: www.cmegroup.com CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com
FRED:UMCSENTShort
by konhow
4
Is CL looking bearish? Short below LIS/Yearly Open?NYMEX:CL1! Macro update: Will we see another bullish leg like Jan 2025? Or does crude oil have room to move further lower and resume its downtrend after putting in the high of the year? In our opinion, most headlines since the new US administration have already been priced in by market participants. Crude oil fundamentals—encompassing supply, production, and demand outlook—are likely to influence prices more significantly than headline news. Our analysis indicates that the market has rebalanced, trading above the Composite Volume Point of Control (CVPOC) at $68.45 per barrel, as derived from our 2022 anchored Composite Volume profile. Furthermore, the 2025 Volume profile is exhibiting a “b”-shaped formation, signaling a move toward balance in its lower range. From a market auction perspective, two key price ranges are established: Q4 2024 Lower Distribution: Approximately $65–$70, indicating a balanced market. Q1 2025 Value Area: Approximately $70–$75, also reflecting balance. In our analysis, it’s essential to adopt a broader view by examining higher timeframe levels to stay aligned with these key market levels. While intraday or intrawork trends may display bearish or bullish momentum, the overall market auction framework suggests further consolidation within these ranges—unless new developments significantly alter the crude oil fundamentals or breaking headlines emerge that have yet to be priced in. Key Levels to Watch Key levels represent areas of interest and zones of active market participation. The more significant a key level, the closer we monitor it for potential reactions and trade setups in alignment with our trading plan. Jan 2024 CVPOC and mCVPOC Q4 2024 confluence: 68.45 - 68.25 Key Bull Support/LIS: 69.90 - 70.50 Feb 2025 VAL: 70.80 2025 mCVPOC: 72.82 Feb 2025 VAH: 72.70 mCVAH/Jan 2025 mid: 74.96 - 74.80 Scenario 1: Price gets above key support to further consolidate within Feb 2025 Value Area Scenario 2: Intraday bullish price action with higher lows that fails to gain momentum above the 2025 VPOC. Scenario 3: Price holds below Yearly Open and LIS key support. A bearish head and shoulders pattern develops to push prices lower to test CVPOC 2022. Micro CME contracts allow for more precise risk management during volatile market conditions. Additionally, you can participate in the CME and TradingView paper trading competition, giving you the opportunity to test your skills in The Leap without risking real money.
NYMEX:CL1!
by EdgeClear
Leap Ahead with a Dynamic Setup: Trading with Andrew’s PitchforkThe Leap Trading Competition: A Chance to Trade Micro Euro Futures TradingView’s "The Leap" Trading Competition provides an opportunity for traders to apply their futures trading strategies in a competitive environment. Participants can trade select CME Group futures contracts, including Micro Euro Futures (M6E). This article presents a structured trade setup using Andrew’s Pitchfork, a technical tool that helps define potential trend direction and breakout levels. The setup involves two intersecting pitchforks near a key UFO support level, signaling the possibility of either an uptrend continuation or a confirmation of a new downtrend. Understanding Andrew’s Pitchfork and Market Structure Andrew’s Pitchfork is a technical analysis tool used to identify trend channels by plotting three parallel lines from a major price swing. The tool helps traders anticipate support, resistance, and breakout levels based on median lines. In this setup, two pitchforks define opposing market structures. The green pitchfork represents an uptrend, suggesting that price could continue higher. The red pitchfork represents a developing downtrend, indicating a possible reversal. The intersection of these pitchforks at a key UFO support level marks an important decision point for the market. The Dynamic Trade Setup: Long and Short Scenarios In a long trade scenario, entry is confirmed if price breaks above the Upper Median Line (UML) of the red pitchfork. The target for the trade is the Median Line (ML) of the green pitchfork, representing trend continuation. A stop loss is placed below entry at a distance that ensures a minimum 3:1 reward-to-risk ratio. In a short trade scenario, entry is confirmed if price breaks below the Lower Median Line (LML) of the green pitchfork. The target for the trade is the Median Line (ML) of the red pitchfork, confirming further downside movement. A stop loss is placed above entry at a distance that maintains a minimum 3:1 reward-to-risk ratio. Because the UML, LML, and ML levels change dynamically with each bar, breakout levels and targets must be adjusted accordingly. If price remains inside the pitchfork structure, the setup remains neutral until confirmation occurs. Contract Specifications and Margin Requirements Euro FX Futures (6E) details: Full contract specs: 6E Contract Specifications – CME Group Contract size: €125,000 Tick size: 0.00005 per EUR/USD ($6.25 per tick) Margin requirements depend on broker conditions and market volatility, currently around $2,600 per contract. Micro EUR/USD Futures (M6E) details: Full contract specs: M6E Contract Specifications – CME Group Contract size: €12,500 (1/10th of 6E) Tick size: 0.0001 per EUR/USD ($1.25 per tick) Lower margin requirements provide access to traders with smaller accounts, currently around $260 per contract. M6E offers a lower-cost alternative to 6E, making it a useful instrument for adjusting position sizes and managing risk effectively. Traders should consider market conditions and leverage when determining position sizes. Execution and Trade Management Before executing a trade, price must confirm a breakout by fully breaking above UML for long trades or below LML for short trades. Additional confirmation through volume trends, momentum indicators, or candlestick patterns may help validate the move. If price does not confirm the breakout, the setup remains invalid. If price re-enters the pitchfork channel, traders should reassess market structure before taking a new position. Stop losses should be maintained at levels that align with a structured risk-reward plan. Conclusion Andrew’s Pitchfork provides a structured approach for trading trend continuation and reversals. This setup allows for both long and short breakout opportunities, depending on how price reacts at key pitchfork levels. For traders in The Leap Trading Competition, this setup highlights the importance of disciplined execution, waiting for confirmation, and managing risk effectively when trading futures. 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: tradingview.sweetlogin.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:M6E1!Education
by traddictiv
4
Equity Markets Lagging the Precious Metals Equity indices slipped today as they are looking to retest all time high levels for the ES and the NQ. Traders saw economic data released today including a higher than expected initial jobless claims number along with a lower than expected Philadelphia Fed Manufacturing number. As the equity markets slipped, the precious metals complex saw gains today with Gold, Silver, and Copper all in positive territory. As the week wraps up, traders can look ahead to the existing home sales number along with the S&P Global Manufacturing PMI tomorrow to add some volatility to the market. The CME Fed Watch Tool is currently indicating that rates will again be unchanged for the March meeting, and then a 43.6% chance of a rate cut of 25 basis points at the June meeting. These expectations can change as the year progresses based on different employment and inflation data and will help give a better indication of the strength of the equity and precious metal markets. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/ *CME Group futures are not suitable for all investors and involve the risk of loss. Copyright © 2023 CME Group Inc. **All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
COMEX:GCJ2025
by CME_Group
Tracking Crisis with Stocks/Gold RatioGold Surges with Three Major Crises Over the past 25 years, we have witnessed three significant financial crises: the Dot-Com Bubble, the 2008 Financial Crisis, and the recent 9% inflation crisis. In each of these events, a distinct pattern emerged—gold surged before the crisis reached its full intensity. Historically, gold's price has experienced notable gains before economic downturns: • Dot-Com Bubble: +34% surge • 2008 Financial Crisis: +89% surge • Inflation Crisis (2022): +24% surge Currently, gold has surged 83% from its trough in November 2022. Given this historical correlation, could we be on the verge of another financial crisis? Why Are Central Banks Stockpiling Gold? This current gold rally bears similarities to past surges but also has a crucial distinction. While demand for gold remains strong, this time around, central banks are leading the charge in purchasing gold at an unprecedented rate since 2022. Gold serves a dual function: 1. Inflation Hedge – A safeguard against inflation. 2. Currency Hedge – Protection against currency devaluation. Central banks' aggressive gold acquisitions suggest expectations of prolonged inflation and currency instability. As fiat currencies weaken, inflationary pressures mount, reinforcing gold’s attractiveness as a safe haven asset. Fundamental Indicators Paint a Cautionary Picture A deeper dive into key economic indicators suggests a challenging outlook. Here are some red flags: • Treasury Bonds in a Downtrend – Indicating a loss of confidence in long-term debt securities. • Interest Rates Remain High – Despite inflation cooling from 9% to 3%, borrowing costs remain significantly higher than pre-2022 levels. Elevated interest rates place pressure on businesses and, eventually, stock prices. • Inflation Remains Stubborn – The lowest recorded inflation since the peak was 2.4%, but it has now ticked back up to 3%. With ongoing tariff escalations, inflation could reignite. These fundamental factors indicate that financial markets remain vulnerable to shocks, reinforcing the case for cautious positioning. The Technical Outlook: A Bullish Trend Still Holds Despite fundamental concerns, technical analysis suggests that the current AI-driven market rally, which began after the introduction of ChatGPT, remains intact. A strong uptrend line connecting all major troughs continues to act as a support level. Timing the Bear with the Crisis The bond market is already signaling distress. If equity markets break below this well-established uptrend line, my strategy will shift dramatically. Instead of looking for buying opportunities on dips, I will pivot to selling on strengths, anticipating a market downturn. My Trading Strategy: Still Buying on Dips I have provided a daily chart with updated trendlines, marking key support and resistance levels. My trading approach will be guided by these levels to manage risk effectively. Preferred Instruments: Outright futures and call options. Market Outlook: Cautiously bullish. While economic conditions warrant vigilance, technical indicators suggest that the bullish trend remains intact—until proven otherwise. Happy trading! Please see the following disclaimer and information that you may find useful: E-mini Nasdaq Futures & Options Ticker: NQ Minimum fluctuation: 0.25 index points = $5.00 Micro E-mini Nasdaq Futures & Options Ticker: MNQ Minimum fluctuation: 0.25 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • My mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. Trading competition: tradingview.sweetlogin.com Trading the Micro: www.cmegroup.com CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com
COMEX:GC1!Long
by konhow
Does our LIS hold? Weekly CL Trade IdeaNYMEX:CL1! Macro Update: There are a lot of market moving events taking shape on the macro landscape. Peace negotiations between warring countries, reciprocal trade tariffs, and a US-Iran nuclear deal. We need not mention that any of these events may potentially turn market sentiment risk on or risk off. It all depends on how these all unfold. On the economic front, we have rate decisions from various central banks. Most central banks reiterate cautious cuts and turn hawkish amidst concerns about the rising inflation outlook. Central banks are also pointing towards rising uncertainty on the outlook itself as we mentioned above. It all depends on how events unfold. WTI Crude Oil Big Picture: Viewing a weekly full session WTI crude oil chart, we can see 3 weeks of one time framing up on the weekly chart starting Dec 30th, 2024. We then saw a rejection of uptrend and prices reverting to 2024 Value area. We can see four bearish weekly candlesticks from the week starting Jan 20th, 2025. Last week, the price action on the weekly timeframe formed an inverted hammer showing bearish pressure increasing on WTI crude oil. Our key LIS and key bull support show the confluence of multiple market generated levels has held up for the past 3 weeks. Traders take note that WTI crude oil futures contract has rolled over to April 2025 contract. Symbol: CLJ2025 In addition, DOE WTI inventory numbers will be released on Thursday 11am CT due to US President’s Day on Monday February 17th, 2025. Key Levels to Watch Key levels represent areas of interest and zones of active market participation. The more significant a key level, the closer we monitor it for potential reactions and trade setups in alignment with our trading plan. 2025 mcVPOC: 72.82 Feb 2025 mcVAH: 7 2.48 2025 mcVAL: 70.56 Yearly Open/ LIS: 70.52 Key Bull Support/ Confluence Zone: 70.52 - 70.12 Scenario 1: Range bound week ahead In this scenario we expect range bound price action contained within Feb 2025 micro composite Value Area. Scenario 2: Risk-off sentiment shift prices below key LIS In this scenario, we may see a breakdown of our key bull support and Line in Sand. Price moves and stays below yearly open price, providing a possible shift lower towards composite volume point of control (CVPOC). Micro CME contracts allow for more precise risk management during volatile market conditions. Additionally, you can participate in the CME and TradingView paper trading competition, giving you the opportunity to test your skills in The Leap without risking real money.
NYMEX:CL1!
by EdgeClear
Tracking Crisis with This Ratio – US Markets vs GoldThese are the 3 major crisis over the last 25 years. The dot com, 08 and the recent 9% inflation crisis. Before each crisis get into its full swing, I have observed there was a surge in gold. In this tutorial, I will share: 1) Why a surge in gold before each crisis? 2) What are the key variables that we should be looking out for this year? and 3) I hope I don’t sound too ambitious in discussing how to time this move? E-mini Nasdaq Futures & Options Ticker: NQ Minimum fluctuation: 0.25 index points = $5.00 Micro E-mini Nasdaq Futures & Options Ticker: MNQ Minimum fluctuation: 0.25 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. Trading the Micro: www.cmegroup.com CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com
COMEX:GC1!Long
by konhow
6
Leap Ahead with a Dual Breakout Setup on ES and MESThe Leap Trading Competition: A Chance to Trade S&P 500 Futures TradingView’s "The Leap" Trading Competition gives traders the opportunity to test their futures trading strategies in a competitive environment. Participants have access to select CME Group futures contracts, including E-mini S&P 500 Futures (ES) and Micro E-mini S&P 500 Futures (MES). This article presents a dual breakout trade setup, analyzing both bullish and bearish scenarios based on key Fibonacci levels and low volatility price ranges. The goal is to trade the breakout of a well-defined range and target either a Fibonacci extension to the upside or a retracement level to the downside. Understanding Breakouts and Fibonacci Levels A breakout occurs when price moves beyond a defined support or resistance level, often leading to a strong trend continuation. In this case, the trading range between 6146.75 and 6121.25 is the key level to watch. A breakout above this range suggests bullish momentum, while a breakout below signals bearish pressure. Fibonacci retracement levels are used to identify potential support or resistance zones based on past price movements. The 50% retracement level at 5985.75 aligns with a UFO support, making it a key downside target if price breaks lower. Fibonacci extension levels project potential price targets beyond the most recent high or low. The 100% Fibonacci extension at 6288.75 serves as the projected upside target if price breaks higher. The Dual Breakout Trade Setup In a bullish scenario, a breakout above 6146.75 confirms entry to the upside. The target for this trade is the 100% Fibonacci extension at 6288.75. A stop loss is placed below the breakout level at a distance that ensures a minimum 3:1 reward-to-risk ratio. In a bearish scenario, a breakdown below 6121.25 confirms entry to the downside. The target is the 50% Fibonacci retracement at 5985.75, which aligns with a UFO support zone. A stop loss is placed above the breakdown level, ensuring a minimum 3:1 reward-to-risk ratio. Risk management considerations include adjusting stop losses based on a trader’s preferred risk-reward ratio. Scaling out at intermediate levels can help manage volatility and secure partial profits. Contract Specifications and Margin Requirements E-mini S&P 500 Futures (ES) details: Full contract specs: ES Contract Specifications – CME Group Contract size: $50 x S&P 500 Index Tick size: 0.25 index points ($12.50 per tick) Margin requirements depend on broker conditions and market volatility – Currently ≈$15,000 per contract. Micro E-mini S&P 500 Futures (MES) details: Full contract specs: MES Contract Specifications – CME Group Contract size: $5 x S&P 500 Index (1/10th of ES) Tick size: 0.25 index points ($1.25 per tick) Lower margin requirements make it more accessible for smaller accounts – Currently ≈$1,500 per contract. Leverage in ES and MES magnifies both potential gains and losses. Traders should consider margin requirements and market conditions when determining position sizes. Execution and Market Conditions Before executing a trade, a typical breakout trader would watch price confirm a breakout by sustaining above or below the key levels. Additional confirmation from volume trends and momentum indicators can improve trade accuracy. If price does not break out, the setup remains invalid. If a false breakout occurs, traders may need to reassess conditions before re-entering. Conclusion A dual breakout setup provides both bullish and bearish opportunities depending on price movement. Fibonacci extensions provide upside targets, while retracement levels align with strong support zones for downside moves. For participants in The Leap Trading Competition, this setup highlights the importance of disciplined execution, confirmation, and structured risk management. 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: tradingview.sweetlogin.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
Inflation Fears Weigh More than China Tech GainsDeepSeek Is Not the Market’s Biggest Concern Over the past few days following the emergence of DeepSeek, Nasdaq or technology stocks have experienced a notable 6% decline across all major U.S. indices. However, this recent pullback pales in comparison to the more substantial drop seen in December. Small-Cap Stocks Take a Bigger Hit The Russell 2000, which tracks small and medium-sized enterprises in the U.S., suffered an even sharper decline, falling by 12%. This suggests that broader economic concerns, beyond just the tech sector, are weighing on investor sentiment. Then, What Is It? On December 18, during the highly anticipated Federal Open Market Committee (FOMC) meeting, the Federal Reserve announced a widely expected 0.25% rate cut, bringing the Fed Funds Rate down to 4.5%. However, it wasn’t the rate cut that rattled the market—it was Fed Chair Jerome Powell’s comments that followed. “… the median participant projected that the appropriate level of the federal funds rate would be 3.9% at the end of 2025, indicating expectations of two additional rate cuts in 2025, down from the four projected in the previous summary.” This statement signaled that the Fed remains hawkish on inflation, with expectations of only two rate cuts in 2025 instead of the previously projected four. As a result, borrowing costs are likely to remain elevated at around 3.9%, a scenario that investors had not fully priced in. The market reacted negatively, with indices falling sharply over the subsequent weeks. Market Stabilization Amid China Tech Competition Despite the recent downturn, there are signs of stabilization, with major indices still maintaining their position along an established uptrend line. As long as inflation continues to ease—hovering around 3% or, ideally, heading toward the Fed’s 2% target—the broader market outlook remains positive. From a strategic standpoint, I will continue to focus on buying dips if the market respects the uptrend line. However, if hopes for rate cuts in 2025 fade and the trend begins to break below key support levels, my strategy will shift toward selling into strength when opportunities arise. Short-Term Trading Outlook To refine my trading decisions, I have also drawn trendlines on an hourly chart. Applying the same uptrend principles, these lines serve as a guideline for short-term trading in the Micro S&P 500 futures. With the latest January Consumer Price Index (CPI) reading at 3%—higher than expected—I will be closely monitoring my daily chart's uptrend line. While external economic conditions remain unpredictable, adapting trading strategies in response to market trends is key to staying ahead. Please see the following disclaimer and information that you may find useful: E-mini S&P 500 Futures & Options Ticker: ES Minimum fluctuation: 0.25 index points = $12.50 Micro E-mini S&P 500 Futures & Options Ticker: MES Minimum fluctuation: 0.25 index points = $1.25 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • My mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. Trading competition: tradingview.sweetlogin.com Trading the Micro: www.cmegroup.com CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.sweetlogin.com
CME_MINI:NQ1!Long
by konhow
#TheFuturesLeapBitcoin has been on the forefront of traders minds over the past few months with the strong move to the upside over the $100,000 mark analysts have been looking for for some time. Since the January Highs, prices have come down and been bouncing back and forth, and now traders are asking “what’s next?” TradingView’s “The Leap” Trading Competition presents a unique opportunity for traders to put their futures trading skills to the test. This competition allows participants to trade select CME Group futures contracts giving traders access to some of the most actively traded commodities in the world. Register and compete in "The Leap" here: TradingView Competition Registration . As for prizes, there’s something for everyone 250 awards, including cash and plan extensions. 1st place — $3,000 2nd place — $1,500 3rd place — $1,200 4th place — $1,000 5th place — $800 Places from 6th to 25th — $500 Places from 26th to 50th — $300 Places from 51st to 250th — 6 more months of your current plan Symbols for trading: Ten futures are available, representing the most popular CME Group contracts: E-Mini Nasdaq-100, Micro E-Mini S&P, Micro Bitcoin, gold, and more. CL1! MES1! NQ1! MBT1! MCL1! M6E1! MGC1! GC1! ES1! MNQ1! If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/ *CME Group futures are not suitable for all investors and involve the risk of loss. Copyright © 2023 CME Group Inc. **All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
CME:BTC1!
by CME_Group
Gold Options Activity Point to Continuing RallyNot a single macro portfolio manager was fired for adding gold to their portfolio over the last two years. Such has been gold’s stunning performance. Will Gold’s ascent continue? Narratives and numbers signal unstoppable and solid bull run in gold for now. BULL CASE REMAINS INTACT AND IS INTENFISYING This paper will not delve much into fundamentals. We have covered it previously in Gold to Shine Bright on Fundamentals, Seasonality & Sentiments . In that we highlighted the three main forces at play: (a) Continued central bank purchases, (b) Rising consumer demand in China & India, and (c) Trump administration’s fiscal policies favouring gold. In addition to the above, US Dollar weaponization, De-dollarisation fears, and Tariff tensions, serve as additional tailwinds. TradingView Wizard, Konhow , has comprehensively covered the historical impact of tariffs on Gold in his recent paper and video . SENTIMENTS HAVE SURRENDERED IN FAVOR OF RISING GOLD This research note will not dive into the weeds of technical analysis either. TradingView’s Technical Analysis dashboard summarises it all elegantly. TradingView Momentum is in favour. Oscillators are neutral indicating little risk of price reversal. Overall, sentiment remains bullish gold. Gold prices as represented by CME Micro Gold Futures front month contract formed a golden cross on 10th January 2025. Since then, prices are up 8.5% as of 13th February 2025. Current prices are well above its 50-day, 100-day, and 200-day DMAs. RSI is in overbought zone. Expect some pull back in gold prices from time to time on profit taking. But the upward trend is undeniable. The MACD shows that Gold momentum continues to be on the rise but with waning bullishness. Readers can access the entire library of technical ideas focussing on Gold on TradingView’s Gold Ideas Page ideas page . OPTIONS MARKETS ARE SIGNALLING A SOLID BULL RUN AHEAD This paper aims to unpack recent activity in CME gold options market and its impact on prices. No contrary signals there either. Options market also signal bullish gold. QuikStrike is a free-to-use tool for registered participants on the CME Group website. The tool provides a vast range of analytics to guide portfolio managers & traders to better comprehend the underlying market. Each report comes with a helpful user-guide to describe the data covered within the report. Some key takeaways below: Open Interest Profile page shows that as of close of markets on 11th February 2025, total call open interest (“OI” for short) stood at 634,815 lots across all expiries and strikes. Aggregate put IO totalled up to 357,305 lots resulting in a put-call ratio (p/c ratio) of 0.56. Calls are options contract that represent a bullish view. While puts are contracts representing bearish outlook. At 0.56 p/c ratio, there are twice as many bullish positions for each bearish one. Source: CME QuikStrike Most Active Strikes allow portfolio managers and traders to analyse top strikes with shifts in open interest. Table below shows top 10 strikes registering the largest change in open interest between 4th February and 11th February. Starting first with the Calls (left section of the table below), participants have been building up open interest in strikes 4000, 3200, 3250, 4500, 4032, and 3,975. Call options have also booked reduction in open interest at strikes 3000, 3075, 3100 and 3025. On a net-basis, open interest is up 10,312 lots across these top ten strikes over various expiries this year. Source: CME QuikStrike Puts (right section of the table above) shows rising build up in open interest for strikes ranging from 2740 to 2880. Collectively, this indicates that market participants are rooting for gold prices to rise through USD 3,000/oz and to even rally past USD 4,500/oz. Will that happen? Only time will tell. Given that risk managers are establishing puts at such high levels point to strong support for gold prices at current levels. In a nutshell, current prices are not only formidably comfortable but the potential to rise is also highly probable. Shifting the attention to volatility, the CME Group also offers CVol which is another free-to-use tool. Portfolio managers and traders can visualise implied volatility behaviour on this tool. Source: CME CVol The GCVL which is the Gold CVol index shows implied volatility at 17.65 and with a positive skew of 1.08. Implied volatility easing even at an elevated prices indicates that market participants are comfortable at current price levels and do not foresee immediate large price moves. Skew on the CVol tool is defined as Up Var minus Down Var. Up Var is the likelihood of the price rising while Down Var measures the likelihood of prices falling. A positive skew shows that the market is pricing a higher likelihood of rising prices relative to a down move. FUND FLOWS INTO GOLD ETF IS UP 47% YOY Among its rich set of features, TradingView also shows daily ETF fund flows . GLD is the prominent ETF commanding assets under management (AUM) of USD 80.65 billion. This time last year, GLD ETF showed AUM of USD 54.77 billion. Fund inflows have spiked 47.25% over the past 12 months. HYPOTHETICAL TRADE SETUP With fundamentals, sentiment, options market, and fund flows all pointing to a price that is set to rise, this paper posits a long position using CME Micro Gold Futures expiring on 28th April 2025 (MGCJ2025) based on the following entry, exit levels and the reward-to-risk ratio: • Entry: USD 2,900/oz • Target: USD 3,100/oz • Stop: USD 2,800/oz • P&L at Target (USD per lot): +2,000 ((3,100 – 2,900) x 10) • P&L at Stop (USD per lot): -1,000 ((2,800 – 2,900) x 10) • Reward-to-Risk Ratio: 2x Please note that Each Micro Gold Futures contract provides an exposure to 10 troy ounces. Both standard-sized gold futures (GC) and the newly launched 1-ounce gold futures offer avenues to express bullish sentiment on the yellow metal. This comprehensive suite of gold futures is tailored to enhance flexibility and precision, empowering investors to capitalize on market opportunities effectively. CME Group lists a raft of products covering a range of asset classes more accessible while also enabling granular hedging for portfolio managers. Portfolio managers can learn more on how to access these micro products by visiting CME Micro Products page on CME portal to discover micro-sized contracts to gain macro exposures. In collaboration with the CME Group, TradingView has launched The Leap trading competition. New and upcoming traders can hone and refine their trading skills, test their trading strategies, and feel the thrill of futures trading with a vibrant global community through this paper trading competition sponsored by CME Group using virtual money and real time prices. The competition lasts another 15-days. Please join the 48,000+ others who are actively honing their trading skills using virtual money. Click here to learn more. MARKET DATA CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme . DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
COMEX_MINI:MGC1!Long
by mintdotfinance