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2020’s 5 Hottest Trading Markets

July 30, 2020 by Daniels Trading| Futures 101

This has been a historic year in the capital markets, headlined by the novel coronavirus (COVID-19) pandemic. A true black swan event, the COVID-19 outbreak injected unprecedented uncertainty into the world’s financial system. If you’ve been active in the markets since Jan. 1, then you’re hip to the huge volatility and volumes of 2020.

So what are the five hottest trading markets for 2020? Let’s take a look at the top futures contracts from the equity, currency, and commodity asset classes.

1. E-mini S&P 500

A staple of the equity index offerings from the Chicago Mercantile Exchange (CME), the E-mini S&P 500 (ES) has been on fire throughout the coronavirus contagion. Beginning in late February, this market has witnessed several historic sell-offs, epic volatility, and a robust recovery.

One of the great things about the E-mini S&P 500 trading markets is that they provide traders with the utmost in liquidity. CME Globex volumes regularly eclipse 2 million contracts per session, all but guaranteeing robust market depth.

Throughout March 2020, average daily volumes (ADV) on the front-month ES contract measured several times established norms. In the process, trading was repeatedly “halted” as crashes in pricing triggered the 5 percent overnight circuit breaker and the 7 percent U.S. session threshold.

2. West Texas Intermediate (WTI) Crude Oil

Unless you’ve been living under a rock—or in quarantine—you have probably heard about the tumult facing the global oil complex. As a result of the COVID-19 economic shutdown and a heated Russia-Saudi Arabia price war, an atypical supply glut made crude oil temporarily worthless.

On April 20, 2020, the energy market panic hit a crescendo as May WTI futures closed at a record low of -$37.63 per barrel. One day later, the May WTI contract expired priced at $10.01 per barrel―a 24-hour rally of $47.64. The rebound was a preview of the 88 percent rally in May, the largest single-month spike on record. If you’re looking to define the term resilient, look no further than the WTI trading markets for May 2020.

Read our guide, Basic Training for Futures Traders, and discover 50 of the best tips from experts.

3. E-mini NASDAQ 100

Decades from now, financial historians will refer to March 2020 as the quintessential example of how fear can negatively impact the capital markets. However, April, May, and June 2020 for the E-mini NASDAQ 100 are clear illustrations of just how fast an irrational market can recover.

Composed of companies from the technology and growth sectors, the NASDAQ 100 reacted violently to the onslaught of COVID-19. Accordingly, prices of the September E-mini NASDAQ 100 plummeted by 7.90 percent during March. Nonetheless, merely 90 days removed from March’s panic-induced lows, the September E-mini NASDAQ 100 had posted fresh all-time highs amid a furious 52 percent rally.

4. Gold

Gold’s performance during the first half of 2020 offers a basic tutorial of how a safe-haven asset should behave. Although pricing charts for 2020 gold futures trading markets don’t show a rocket ship to the moon, they do illustrate consistency during a bona fide financial crisis.

From Jan. 1-June 1 2020, August 2020 gold futures rallied by $209.80 per ounce―a net gain of 13.6 percent. Still, the six-month period regularly featured extreme intraday volatility. On March 13, gold lost 4.62 percent; 10 days later, on March 23, the bullion market rallied 5.76 percent, regaining earlier losses. Although gold bugs did well during the first half of 2020, the path to profitability was anything but boring.

5. Euro FX

2020 proved to be a hyperactive year for currency traders as the global monetary system faced a collection of unique challenges. In an attempt to provide emergency COVID-19 liquidity, central banks around the globe implemented aggressive quantitative easing (QE) packages.

Subsequently, the world’s most frequently traded currency pair, the EUR-USD, exhibited acute volatility. For spring 2020, September Euro FX futures posted a high of 1.15680 and low of 1.07060 ― a truly astonishing 1724 tick range. To say the least, rate cuts, subprime lending, and massive debt purchases sent foreign exchange rates into a state of flux.

Futures Trading Markets Have Something for Everyone

No matter whether you’re an equity, currency, or commodity trader, CME futures offer a wide range of vibrant trading markets. To learn more about how to get started successfully, check out Daniels Trading’s online e-book Basic Training for Futures Traders.

Basic Training for Futures Traders

Filed Under: Futures 101

About Daniels Trading

Daniels Trading is division of StoneX Financial Inc. located in the heart of Chicago’s financial district. Established by renowned commodity trader Andy Daniels in 1995, Daniels Trading was built on a culture of trust committed to a mission of Independence, Objectivity and Reliability.

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.

© 2023 StoneX Group Inc. All Rights Reserved

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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.

© 2023 StoneX Group Inc. All Rights Reserved

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