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How To Make Your Futures Trading Charts Better

by | Futures 101

In the contemporary marketplace, pricing charts are the trader’s window to the action. Unless you craft your decisions based solely on fundamentals, having access to robust futures trading charts is a big part of achieving success. 

Step #1: Select the Best Chart for Your Needs

By far, the single most important characteristic of a pricing chart is its usability. Futures markets frequently move at break-neck speeds, demanding the utmost attentiveness from active traders. That’s why it’s important for a chart to be user-friendly ― it furnishes the trader with a comprehensive picture of price action without any mental gymnastics.

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The first step to enhancing your charting application is selecting the proper format for the presentation of pricing data. Formatting is a key component of any chart because it takes live streaming data from the exchange and places it into a useful context. Without ideal formatting, a price chart is mostly worthless. 

Here are a few of the most common formats put forth by futures trading charts:

  • Open high low close (OHLC): A traditional form of charting, the OHLC format is especially handy for identifying market state. It provides essential pieces of price-specific information — such as the periodic open, high, low, and close — for detailed analysis.
  • Japanese candlesticks: Candlesticks are exceedingly popular among technical traders. They provide an intuitive visual reference to users and are ideal for spotting previously obscure patterns.
  • Line: The line chart is a tried-and-true form of price data study. It’s useful for quickly identifying market direction and eliminating any unwarranted noise.
  • Time price offering (TPO): TPO charts illustrate the relationship between price and traded volumes. Fans of Market Profile or volume analysis typical use this type of chart.

In reality, trades can choose from a vast array of futures trading charts, ranging from simple to highly specialized. Many varieties facilitate specific trading such methodologies as Heikin-Ashi candlesticks or Renko charts.

No matter what chart type you choose, it’s imperative that it compliments your technical approach to the market. For instance, if you’re a pattern trader and reference a simple line chart, your odds of success drop exponentially. In that situation, candlestick or OHLC futures trading charts would provide far superior functionality.

Step #2: Optimize Your Futures Trading Charts

After selecting an ideal chart for your trading style, make sure to optimize the presentation. Here are three ways to accomplish this objective:

  • Customize: The beauty of the pricing chart is that it’s fully customizable. You can add indicators at your leisure and manipulate data sets according to any desired parameter. In short, customize for comfort!
  • Fine-tune: Ultimately, a chart is a hands-on, visual tool. Modifying things as simple as fonts and colors can greatly boost usability. Reducing any unwarranted latencies through performing regular software maintenance and updates can further enhance performance.
  • Eliminate clutter: In futures, things move quickly. Traders are continuously hit with a barrage of data, both relevant and extraneous. When it comes to the pricing chart, it’s crucial that only information deemed useful is represented. Unless a specific data set, indicator, or tool is an active part of your strategy, then it’s clutter ― get rid of it!

If your futures trading charts are not user-friendly and easily referenced, their contributions to your performance will be limited. However, by streamlining each chart’s appearance and functionality, you’ll increase its utility multifold.

Want to Become a Chartist?

For technical traders, charting is often viewed as being an art form. Fortunately for aspiring chartists, modern software trading platforms have taken most of the guesswork out of the equation.

If you’re interested in building your own futures trading charts, look no further than Daniels Trading’s flagship platform dT Pro. Featuring real-time streaming quotes and a library of advanced technical indicators, dT Pro can help take your chart game to the next level.

Ready to think like a technical trader? Download our free guide to learn how to identify chart formations and take action when the time is right.

Risk Disclosure

The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided. References to over-the-counter (“OTC”) products or swaps are made on behalf of StoneX Markets LLC (“SXM”), a member of the National Futures Association (“NFA”) and provisionally registered with the U.S. Commodity Futures Trading Commission (“CFTC”) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ (“ECP”) and who have been accepted as customers of SXM. StoneX Financial Inc. (“SFI”) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI does business as Daniels Trading/Top Third/Futures Online. SFI is registered with the U.S. Securities and Exchange Commission (“SEC”) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Adviser. References to securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to exchange-traded futures and options are made on behalf of the FCM Division of SFI.

Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.

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