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.
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
Key Contracts: ES, MES, NQ
IntelliTrade focuses on index futures that track major U.S. stock indices:
| Contract | Full Name | $/Point | 10pt Move | Exchange |
|---|---|---|---|---|
| ES | E-mini S&P 500 | $50 | $500 | CME |
| MES | Micro E-mini S&P 500 | $5 | $50 | CME |
| NQ | E-mini Nasdaq 100 | $20 | $200 | CME |
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):
| Session | Hours (ET) | Notes |
|---|---|---|
| Globex (Overnight) | 6:00 PM – 9:30 AM | Lower volume, wider spreads. Reacts to international news. |
| RTH (Regular) | 9:30 AM – 4:00 PM | Highest volume and tightest spreads. Most institutional activity. |
| ETH (Extended) | 4:00 PM – 6:00 PM | Post-market session. Volume drops off after 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 — When price breaks above the range high, it signals potential upward momentum. When it breaks below the range low, it signals potential 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.
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)
↓ webhook POST with JSON payload
IBKR Webhook Bridge (localhost:5001)
↓ validates → maps symbol → routes to account
IBKR Gateway / TWS
↓ order submitted
CME Exchange (fills)
Safety Features
- Simulation mode — Default mode where no real orders are sent. Practice risk-free.
- 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.