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Future and derivatives thoughts

  #4 (permalink)

Rome, Italy
 
 
Posts: 7 since Jul 2014
Thanks: 3 given, 1 received

Thank You for your answer

Unfortunately i've not got this completely.

The spread between Future and Spot is high at the begin of contract rollover and decrease over time until contract ends.

What I can't understand is the equal behaviour between spot and future, take a look at attached pics: EUR/USD example but it's a general speech between all instrument and their related future counterpart.
On Ninjatrader you have the Future, on Metatrader the spot, you can see clearly the same behavior, same HH, HL, LH, LL at the same time, Future appear more smoothed cause spot have 5 digits.

No behavior difference, the question is: if they are independent market flow speaking, why are so similar?

Just an hypothetical example: blue arrow High zone, if i buy a great quantity of contract to clear 10 levels up current price, so price have to raise 10 ticks, if more people buy more contracts on market side and limits are not enough, price have to rise more.. a different behavior between Spot (falling) and Future(Raising). Of course that's not happen , the problem is why thats never happens? Why there's never divergence between them?

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