Futures Trading Guide
Understand futures contracts, margin, leverage, and the key index futures (ES, MES, NQ) that IntelliTrade trades.
What Are Futures Contracts?
A futures contract is a standardized agreement to buy or sell an asset at a predetermined price on a specific future date. Unlike stocks (where you own shares of a company), futures are derivative contracts — their value is derived from an underlying asset like an index, commodity, or currency. If you are new to trading, review the trading basics first.
Key characteristics of futures:
- Standardized — Exchange-defined contract sizes, tick sizes, and expiration dates
- Leveraged — You control a large notional value with a small margin deposit
- Two-sided — You can go long (buy) or short (sell) equally easily
- Cash-settled — Index futures (like ES) settle in cash, not physical delivery
- Near 24-hour trading — Available almost around the clock on weekdays
Stocks
Leverage: None (1:1)
Hours: 6.5 hrs/day
Short Selling: Requires borrowing shares
Settlement: T+1 (next business day)
Best For: Long-term investing, building wealth
Futures
Leverage: Up to 25:1
Hours: ~23 hrs/day
Short Selling: Just as easy as going long
Settlement: Cash-settled daily (mark-to-market)
Best For: Intraday trading, hedging, leverage
Key Contracts: ES, MES, NQ
IntelliTrade focuses on index futures that track major U.S. stock indices:
ES — E-mini S&P 500
Point Value: $50 / point
Tick Size: 0.25 ($12.50)
10pt Move: $500
Exchange: CME
The standard for experienced traders. Extremely liquid with tight spreads.
MES — Micro E-mini S&P 500
Point Value: $5 / point
Tick Size: 0.25 ($1.25)
10pt Move: $50
Exchange: CME
1/10th the size of ES. Perfect for beginners and smaller accounts.
NQ — E-mini Nasdaq 100
Point Value: $20 / point
Tick Size: 0.25 ($5.00)
10pt Move: $200
Exchange: CME
Tech-heavy Nasdaq 100. More volatile, bigger moves in both directions.
Which Contract Should You Trade?
MES (Micro E-mini)
Best for beginners and small accounts. At $5/point, a 10-point move is only $50. Ideal for learning and testing strategies with real money but limited risk.
ES (E-mini)
The standard for experienced traders. At $50/point, it is 10x the exposure of MES. Extremely liquid with tight bid-ask spreads. Most institutional traders use ES.
NQ (Nasdaq)
Tracks the tech-heavy Nasdaq 100. More volatile than ES, meaning bigger moves in both directions. At $20/point, it offers a middle ground in sizing.
Tick Size and Value
Futures prices move in increments called ticks:
- ES/MES: Minimum tick = 0.25 points ($12.50 for ES, $1.25 for MES)
- NQ: Minimum tick = 0.25 points ($5.00 per tick)
Margin and Leverage
Futures trading uses margin — a good-faith deposit that lets you control a much larger position than your deposit. This leverage amplifies both gains and losses.
Types of Margin
- Initial Margin
- The amount required to open a new position. Set by the exchange (CME) and varies by contract. For ES, it is typically around $12,000-$15,000 per contract.
- Maintenance Margin
- The minimum balance you must maintain while holding a position. If your account falls below this level, you receive a margin call and must add funds or close positions.
- Day Trading Margin
- Many brokers offer reduced margin for positions opened and closed within the same day. This can be as low as $500 per ES contract, though this varies by broker.
Trading Sessions
Futures markets trade in defined sessions (all times Eastern):
Globex (Overnight)
Hours: 6:00 PM – 9:30 AM ET
Lower volume, wider spreads. Reacts to international news and overnight developments.
RTH (Regular)
Hours: 9:30 AM – 4:00 PM ET
Highest volume and tightest spreads. Most institutional activity happens here.
ETH (Extended)
Hours: 4:00 PM – 6:00 PM ET
Post-market session. Volume drops off after the stock market close.
IntelliTrade's futures strategies primarily focus on RTH (Regular Trading Hours) when volume and liquidity are highest, particularly the first 30 minutes after the open when the Opening Range is established.
Opening Range Breakout (ORB)
The Opening Range Breakout is one of the most popular intraday futures strategies. Here is how it works:
The Concept
Identify the Opening Range
During the first 15–25 minutes of RTH (9:30–9:55 AM), the market establishes a high and low. This range captures the initial battle between buyers and sellers.
Wait for a Breakout
Price breaking above the range high signals upward momentum. Breaking below the range low signals downward momentum.
Enter the Trade
Enter in the direction of the breakout with a stop loss on the other side of the range.
Manage the Trade
Use trailing stops to lock in profits as the move extends. IntelliTrade's ORB v11 automates this entire flow.
Why ORB Works
The opening range captures overnight positioning and early institutional order flow. A breakout from this range often leads to sustained moves because:
- Institutional traders use the opening range to set their day's bias
- Stop orders cluster above the high and below the low, fueling the breakout
- Momentum traders pile in once the range is broken
How IntelliTrade Trades Futures
IntelliTrade's futures system connects TradingView charting to Interactive Brokers execution through a webhook bridge:
Signal Flow
TradingView Chart
Pine Script ORB v11 detects breakout/breakdown on 5-min chart and fires a webhook POST with JSON payload.
IBKR Webhook Bridge
Validates the signal, maps symbol to contract, and routes to the correct account.
IBKR Gateway / TWS
Order submitted to Interactive Brokers for execution.
CME Exchange
Order fills on the CME. Position is live and monitored for exit management.
Safety Features
- Simulation mode — Default mode where no real orders are sent. Practice risk-free via the auto-trading system.
- Position limits — Maximum contracts per account (default: 1)
- Daily loss limit — Automatically stops trading when the daily loss threshold is reached
- Kill switch — Instantly flattens all positions and blocks new orders
- Duplicate detection — 5-second window prevents accidental double entries
GEX Integration
While futures themselves don't have gamma exposure, IntelliTrade uses GEX levels from the options market as support and resistance for futures trades. Key GEX strikes (Put Wall, Call Wall, GEX PIN) act as magnets and barriers for SPX/ES price, making them valuable reference points for futures entries and exits.
The AI Brain also provides futures-specific analysis, combining ORB signals with GEX context for more informed trading decisions. Many futures traders use prop firm funded accounts to trade with firm capital, reducing personal risk while still earning real profits.