Futures and Technical Analysis

[BadgerMatt]

This is probably a very basic question, but I'm struggling to find the answer.

I am currently attempting to put together a trading strategy - my entry and exits are to be based on technical analysis only, mainly based on support and resistance. So far I have been testing it on indices and forex, but I am interested in testing it on commodities too. However, you can only trade commodities on the futures markets.

The only charts I have come across simply show the market data for the length of the contract in question, i.e. only for a period of up to a few months, sometimes less. This is not enough data to identify areas of support and resistance.

Do I need to pay for charts which combine price data for sequential contracts? Does that even work? Surely there will be discrepancies between the end of (say) the March contract and the beginning of the June?

And are my questions revealing even more things I am ignorant about without even realising it?!

Many thanks in advance for any help anyone can give

 

[DashRiprock]

hi badgermatt

yes you can get graphs off longer timeframes depending on your graphing program they are called different things like continuous contracts or rolled contracts or whatever

about the different prices and things, you can normally set the settings on your package to "roll" the future forward to the next one because for different futures the liquidity changes and the rules are different (like serial or quarterly contracts and official end date to unofficial end date and especially on bond futures because there is a whole expiry MONTH!)

you can as well set the setting for changing all the graphs in the past up to new todays prices graph from interest rate adjustments and things like that

i dont know about free packages but paid for packages all have this. an idea might be to look for some spreadbetter software? because the spreadbetter brokers will lay off too much exposure in the future so they might as well do all the sums and give it to their clients anyway? a tick here or there doesnt matter trading from graphs is all a lottery anyway

 

[BadgerMatt]

Dash.

Thank you very much for the reply - much appreciated. It's good to know I'm not going mad and that I don't need to try to do TA off less than 3 months worth of data. I do have a spreadbetting account but they only give me the data for the current contract. But your answer also demonstrates to me that there are many variables I need to get my head around before I try to dip my toe into the futures water, so to speak.

Time to do a lot more reading I think! Thanks again.

 

[robster970]

Alternatively trade of < 3 month timeframe. Unless you're position trading (well capitalised to absorb risk) then I can't see how long term would be useful.

 

[BadgerMatt]

Alternatively trade of < 3 month timeframe. Unless you're position trading (well capitalised to absorb risk) then I can't see how long term would be useful.

Fair point Robbo. I am only looking at the daily charts, and tend to like to look back a year or more to find the most common S/R areas, but I guess under 3 months would still give me some info. I might demo that too.

Good to meet you on Saturday. Hope the head is better now. Nowadays it's not uncommon for me if a hangover goes into a second day!

 

[robster970]

Fair point Robbo. I am only looking at the daily charts, and tend to like to look back a year or more to find the most common S/R areas, but I guess under 3 months would still give me some info. I might demo that too.

Good to meet you on Saturday. Hope the head is better now. Nowadays it's not uncommon for me if a hangover goes into a second day!

Good to meet you too Matt. I didn't feel right until this morning tbh

Badger, badger, badger, badger, mushroom, mushroom!

 

[LiveTradingZone]

With Tradestation you can look back as many years as it has been around. You might want to give them a try.