How to Day Trade Futures

Check out my free trading course at – http://www.chrisdunn.com/how-to-day-trade/

In today’s lesson we’re going to talk about 3 things:

– How to choose a market to trade (pros and cons of each)
– The different components of your trading business
– Costs associated with trading

By the end of the video, you will know the basics of how to put together your trading business.

How to choose a market to trade

When it comes to deciding which market you’re going to day trade, it’s important to know all the pros and cons of each market. Not every market is suitable for every trader. Also, the best market for you will be the one that best fits your schedule and goals.

My favorite markets to trade are “regular” stocks and e-mini futures. My least favorite market to trade is traditional FOREX (currencies). I do trade currencies, but I trade them through the e-mini futures exchanges because of price transparency, government regulation, and simplicity of trading. You can make a lot of money in penny stocks if you pick the right stock at the right time, and happen to find shares to trade. However, you should keep in mind that penny stocks come with their own set of limitations and challenges. Options trading is highly competitive and complicated, and may prove to be extremely difficult for new traders.

The main components of your trading business:

– Computer & Internet:
– Any “off-the-shelf” computer (3 gigs ram or more)
– 3mbps or higher internet

Trading Capital:

Day Trading Stocks — minimum $25,000 required to be a “pattern day trader”
E-minis – $2k+ (whatever the brokers require, no pattern day trader rule)

*It’s important to keep in mind that you need to be properly capitalized to trade. Some scam artists will claim you can turn $500 into $2 million if you just buy their magic system. I always like to say, “If it sounds too good to be true, then it probably is”.

Broker:

Retail vs. Boutique – Retail brokers (like you see on CNBC commercials) typically charge higher commissions, have less quality data feeds, and poor service. Boutique brokers specialize in their markets, have low commissions, and usually personal service. If you want to know who I currently recommend as a broker, email me at chris (at) chrisdunn (dot) com.

Data Feed:

Direct access – Make sure you have a real-time data feed. Without live price action you won’t be able to compete with other professional traders.

Trading Platforms:

– Computer application – The best trading platforms are typically “computer based”, meaning they download to your computer.

– Internet based – These are “good enough”, but typically don’t have the best tools for trading live.

– Phone app – Never use a phone to day trade. The only time I use my Iphone apps is to manage a position if I had to step away from the computer.

Trading Strategy:

Your trading strategy is the backbone of your trading business. If your strategy relies on guessing or obsolete strategies, then you will more than likely lose money in the markets. Keep in mind, most traders lose money and this is a competitive business. Most people can’t just read a book and start trading profitably.

– Subjective / Discretionary – This relies on a traders intuition or ability to read multiple indicators, and make snap-judgement decisions. It can take thousands of hours of “screen time” to become a good discretionary trader.

– Automated – Using an automated trading system (trading robot, black-box system) can totally remove human error, but many automated systems fail in the long run. This is typically because market conditions are always changing, and what worked in the past may not work in the future.

– Rules-based – A mechancial (or rules-based) system combines the benefits of automation with the flexibility of a discretionary trader. Most of my trading strategies use a combination of both. At the E-mini Trading Academy, our student traders use our MAP Trading Strategy, which is a rules-based day trading strategy for e-mini futures.

Costs of Trading

Platform:
Free – $200 / month

Data Feed:
Free – $150 / month

Commissions:
Stocks — per share or flat fee
Futures — round turn ($4)
Forex — bid/ask spread

Education:
Training
Strategy — software
Market tuition

My Favorite Trading Setups

Stock Trading:
TradeStation for charts
My own indicators (http://www.eminiacademy.com)
Broker — changes (email me)
Data Feed — from broker

Futures Trading:
Ninjatrader platform
MAP Trading Strategy
CQG / Zen-fire data feed
Broker — changes (email me)

Comments

freedomsyr says:

so what broker do you use for futures?

suyemon says:

Is the technique of analyzing and reading candlesticks for regular stocks
and e-mini futures the same? 

Rjames Elliott says:

Thank you like your work no BS

ravenwda007 says:

For regular stocks i don’t have to guess which stock is going to move or
not. I always know the 1% out of 4000 every single day. And that gives me a
big edge over the market.

jose garcia says:

gratitude for the lesson man,thanks chris!

Dwayne Estep says:

wheres part 3

Brent Kosterewa says:

+Chris Dunn Chris, how do you feel about finding a rapidly fluctuating
penny stock in an OTC market around 0.12 buying in for 3k and selling at
0.15? This nets me approx $400 per trade. I continue to do this 2 or 3
times a day. Ive been watching a particular stock bouncing between 0.12 –
0.15 for a month now. I think its time to get involved with this cash cow.
No???

DoWhat ThouWilt says:

Is it realistic to make 2 percent with $3000 a day that I trade? If I buy
$3000 worth of a $10 stock and that stock gains 2%, will people buy it
ieven though it has raised 2%? I have been using a practice account and I
have been making around 2% a day. I know that since I am trading below
$25k that I can only make 3 trades in 5 business days.

fjaurler says:

This is pure gold for a n00b like me. Brilliant stuff, and so easily
explained.

Devin Harding says:

for someone just starting out, witch broker would you suggest for penny
stocks? and how much is a nice amount to start with?

Dom Rici says:

If you start trading as your only form of income ,,how are your profits
taxed

Tuck Tummy says:

so what type of trading do you do? Do you trade for a few hours in the
morning?

idupizdu says:

Really, like fjaurler said this kind of teaching the basics, short and
simple, but covering all important things (i hope), is just priceless for
us beginners. And all for free, really thank you so much! :D

Guilherme S says:

once I trusted Chris, I even paid for the emini academy his other ”traning
program”

I guess he was a trader..And he was on the right path.. but them he decided
to make money in courses and not trading anymore

bet he does not even trade.. easy to do this sort of videos..

frank toscano says:

Paul Macapagal says:

Thank you for this!! Awesome work..

MonsterDog says:

Dude this helped so much. Thank you 

Bruce Edwards says:

Anybody got any success stories 

aarplane97 says:

Do you know etoro

martin tardif says:

25k ????? i m starting with only 2k 

c.v.r cedric van roeyen says:

I gues you can start trading if you’re 18 or above, But I’m only 17 now and
want to learn everything. Is there something like a demo account or special
training account ?

Daniel Dellmert says:

Is it possible to day trade spot commodities instead of Commoditie futures
?

FreeTrendIndicators says:

Excellent vid, cheers. ★ I prefer trading with a free trend indicator. It
displays awesome results!

JoshTheBoss says:

Is there a way to trade in EUR and European markets (times), or is all
mainly based on US Markets and their openings? Note: I am a total noob, but
I am going through all the videos absorbing the info like sponge, not in a
hurry though :).

Abraham Kohler says:

great info for free which is rare nowadays

JoshTheBoss says:

Love your videos, so glad I came across to this channel.

LaTom says:

Hi Chris this second clip is also impressive for me, another clear cut of
knowledge transfer to the global trader’s community. Cheer!!!!

Jackob16942 says:

Let Chris talk. GET OUT with your scam

plstrom says:

Explain something to me ( if you read this ) please, Can you trade futures
in trade station , or you have to have a different “platform” or software
installed for each market you trade in ?

Eelapirian Rajasingam says:

Thank you for your videos. I want to learn to trade from your
videos……thank you again,

TheGolfboy69 says:

Hey Chris, Cant remember how I got to your videos, I find the internet like
that, but im glad I did. Iv watched the first two and about to watch the
third now. You struck a chord with me when you spoke about looseing a live
account after a few weeks of opening it, I remember it well. I have been
learning the forex market now for 6 years and found it to be the most
frustrating thing to have ever attempted to become good at. Looking foward
to the next few vids. regards Rod

Chinh Phan says:

They are pretty much on everybody’s videos. Question… I am going to start
trading with some extra money I have but I am wondering about the Taxes
that are involved. I don’t believe you have a video on that matter. If you
have a Tax preparer or monitoring software in mind I would appreciate it,

James Bernard says:

minimum 25k? uuuh im pretty sure theres dozens of discount brokers where
the minimum balance is less than 500, sometimes as low as 0

James Bernard says:

fuck you

Apeks3 says:

Whats your email? Curious as to your brokerage setup. Thanks! Great vids!

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