Monday 30 September 2024

7 Key Futures to Watch for Market Direction

How These Futures Can Help You Predict Market Moves
 
   
     

Last week, we talked about how futures help track market direction and global movements. Today, I want to dive into something a little more specific.

These are the 7 futures contracts I keep a close eye on — sometimes called the 7 Sisters — and they give me a pretty clear picture of where the market might be headed.

Each of these futures covers a key part of the global market, and when you put them together, they give you a solid read on market trends before the U.S. market even opens.


The 7 Sisters: Futures Tickers You Should Know

1. /ES (E-mini S&P 500 Futures)
What it tracks: The S&P 500 Index
Why it matters: This is one of the most important indicators of U.S. market sentiment. If the ES futures are moving up, it’s a sign the U.S. market is likely to open higher.


2. /YM (E-mini Dow Futures)
What it tracks: The Dow Jones Industrial Average
Why it matters: The Dow is often used as a gauge of the broader U.S. economy. Watching YM gives insight into how big, stable companies are expected to perform.


3. /NQ (E-mini NASDAQ 100 Futures)
What it tracks: The NASDAQ 100, focused on tech stocks
Why it matters: Tech stocks can often lead the market, and the NQ futures give you a sense of how tech is performing globally. A rise here usually means tech will rally at the open.


4. /DAX (DAX Futures)
What it tracks: Germany’s top 30 companies
Why it matters: Germany is the largest economy in Europe, and the DAX is a strong indicator of European market sentiment. Movements in DAX futures often influence U.S. markets, especially in the morning.
Can’t See DAX Futures on Your Platform?: If your trading platform doesn’t support DAX futures, don’t worry — you can track real-time DAX futures on this Investing.com page


5. /ZB (30-Year Treasury Bond Futures)
What it tracks: U.S. Treasury bonds
Why it matters: Bond futures track interest rates. If ZB futures are moving up, it’s a sign that investors might be fleeing to the safety of bonds, indicating potential weakness in the stock market.


6. /GC (Gold Futures)
What it tracks: Gold prices
Why it matters: Gold is often seen as a safe-haven asset. When GC futures rise, it can signal increased fear or uncertainty in the markets, making it a key indicator of risk sentiment.


7. /CL (Crude Oil Futures)
What it tracks: Crude oil prices
Why it matters: Oil is crucial for the global economy, and movements in CL futures can indicate shifts in energy prices and transportation costs, which can impact everything from inflation to corporate profits.

How to Use the 7 Sisters

By keeping an eye on these 7 futures, you’ll get a good feel for where the market’s headed before the U.S. even wakes up. Think of them as your early heads-up, giving you a clue if the market’s set to open higher, lower, or just flat.

Make it part of your morning routine, and you’ll have a better handle on the bigger picture before the bell rings.

Whether you're looking to trade or just want to stay in the loop, these 7 sisters will help you stay ahead of the game.

— Geof Smith

P.S. There’s a massive move brewing in gold… but timing is everything. Don’t go out and buy gold yet — find out why here.


 
   
 

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