What to do when a futures contract diverges? | Traders Hideout


futures.io - futures trading strategies, market news, trading charts and platforms


Traders Hideout


Discuss day trading practices and futures trading strategies on this forum for all markets. This forum is also for discussing and reviews for brokers, data feeds, and commercial or third party add-ons




 

What to do when a futures contract diverges?

  #1 (permalink)

San Diego California
 
 
Posts: 129 since Oct 2015
Thanks: 23 given, 50 received

What to do when a futures contract diverges?

Trading overnight today....I was interested to see what would be going on with the yen/gold/bonds, Nikkei, etc....

Well we all know the USD/JPY...... The 6j is technically an inverse futures contract of that, so as the chart on USD/JPY goes up, 6J should be going down....
However from this session, things started to diverge from the norm. The 6j started mimicking the USD/JPY.... ??? WTF???

Here is a visual example...
Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

As the USD/JPY made a high, the 6J made a relative high( should be on lows)
Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).



This threw me off my mark and I decided best to not trade the 6J....I'm just curious if anyone has an explanation for this type of phenomenon. It's not like comparing VXX to ES which is normally inverse but sometimes can move in sync like during post election..... 6j and USD/JPY is supposed to be complete inverse of each other....thats why I dont get it??

Reply With Quote