Using thinkorswim Active Trader | Trading Futures
good day everyone john mcnichol here and welcome to another fantastic week of education with td ameritrade you have reached trading futures our subject today is taking a look after current market conditions is we'll go ahead and review the active trader portion of the thinkorswim platform now that may be effective tool for active traders to be able to open close as well as set up additional trades so stick around [Music] all right it's great to see those you that are with us here this morning uh on this webcast i know many of you may be new as we do have a few webcasts promoted today and so do appreciate any of you that are new with us along with people join us each and every week such as sandy tm uh we got deborah ken mark ernesto neil tony robert and everyone else there thanks for being with us we also have mr ken rose helping out on the chat uh any questions i am unable to get to he'll be more than happy to help ken is a fellow instructor and has been around the markets for quite a few years as well and you can also see him on some of our various webcasts or webcast schedule which are some of the tools and resources we'll share with you here today as well let's go ahead and take care of our disclosures we'll go in and we'll get right into it contents intended for educational information purposes only not investment advice or recommendation of any security strategy or account type options not suitable for all investors spread straddles of the option strategies can entail substantial transaction costs including multiple commissions uh and are important factors should be considered when evaluating any trade and you encourage practice which you learned today with tools such as paper money application which is for educational purposes only and successful virtual trading during one time period does not guarantee success of actual funds during a later time period as marketing conditions change continuously futures and futures options trading involves substantial risk and is not suitable for all investors please read the risk disclosure statement provided also futures uh and futures options trading services are provided by charles schwab futures and forex llc these trade privileges are subject to review and approval not all clients will qualify uh make note of transaction fees once again important factors should be considered uh when evaluating any trade it is different for uh futures versus other contracts all right let's go ahead and keep moving and while this webcast may discuss technical analysis other approaches including fundamental analysis may assert very different views and there's a brief bio for those of you that are interested again been an education coach with td ameritrade since going back to 2004 you can see the emphasis of what i teach including the topic today uh some of my likes and uh you can if you want to learn more about me as well as about the markets consider following me on twitter at j mcnichol underscore tda you'll see that at the bottom of the screen throughout the presentation can can be followed at k rose k rosc underscore tda and here's our agenda for today i will go and we'll take a look at some of the current market conditions after a very strong sell-off from last week uh we'll see if there's uh any support to be had uh big week two uh i believe we have the fed uh later on in the week and some other inflationary data so but what we'll do here uh we've had quite a few requests on this is uh utilizing the thinkorswim active trader uh portion of the platform so we'll go ahead and we'll show you on how one can use that and we'll also demonstrate on how we can trade off of that active trader platform in a few different ways there too and would encourage you to do this on your paper money account as you learn some of the functionality of the thinkorswim platform all right let's go ahead and bring up the thinkorswim platform should be up on the screen right now from the futures front just kind of looking down the uh the list here this is a public watch list on future so if you are new to this when you go to watch list you can go ahead and go to public and look for futures in the public list which are listed now if uh if you struggle on identifying the the codes the two character codes such as cl forward slash cl for crude or forward slash si for silver uh both seem to be down a bit uh this morning you can go ahead and right click on the watch list column select customize uh once there you should be able to find description although it will take up a little bit of space i can uh double click on that and move that up in the list to bring up a description for those commodities there again we'll take up a little bit of room there but you can go ahead and see that list there so again as far as uh looks like metals and uh energy taking more of a hit this morning at least with crude and that's even going into some of the grains such as wheat looks like treasuries as well uh a little negative if we go ahead and sort as far as on some of the gainers uh natural gas i is uh showing some gains here at least with the uh ongoing uh issues with uh and the war in ukraine uh with russia as we look at some of the major market indices we are starting to see a little negativity we've seen a bit of back and forth in the overnight we'll take a closer look at that with the dow minis uh being off about a third of a percent small caps off about four tenths of a percent uh s p hit a little bit harder closer to about half percent and the nasdaq which has been relatively weaker for some time off about a half a percent now if we go ahead and take a look at some of the daily charts what you're seeing here is they do have a grid chart and if those are that are new if you wanted to have a similar grid chart i just have an example of a daily chart along with an intraday chart with some pivot points on here and to get that grid i'll go ahead and i'll paste the code now it's not a recommendation of one setup over another just that some students you know may prefer to follow along with a similar grid although you can customize this however way you'd like i typed that code in there for those that are following along at home on the archive session if you go to the setup in the upper right hand corner uh when you're in the setup select open shared item and you can go ahead and type in that code it is case sensitive keep that in mind as far as uh capital u capital b lowercase h six capital s capital h and a capital s there now if you type it in correctly you should be able to click preview and something like this may load up now you can save that uh as any type of uh grid or rename it however you'd like by scrolling up to the top and doing create new and then once you click import that'll be part of your grid chart uh grid chart styles which when you come up to the charts and for some reason i seem to have lost my drawing tools today let's see if i can get these back otherwise i'll just keep using my big mouse pointer sometimes i have a few uh bluetooth issues here and looks like that's possibly continuing so just follow the big mouse here in the upper right hand corner you can click on that drop down and uh any of your styles that you've created would be listed i have quite a few as i do a lot of presentations and kind of archive some of these grid charts here but you don't necessarily have to do that and then when you open it up it may look something similar to like this where we have forward slash mes representing the micro contract for the s p futures and as we kind of zoom on this on a daily we can see we're continuing lower just below the 4100 mark you can also see that reflective uh on the intraday chart here on the five minute uh at least at the opening potentially temporary or at the very at the moment took out some of the lows from the overnight but we can see some volatility as prices may be looking to try and snap up there and we'll keep an eye on this today i'm going to close that out and what i'll do is i'll maximize here on the daily chart uh a lot of you that followed us in uh previous weeks you know we have talked about some of the fibonacci levels some of the potential support areas for the market and seeing how they're uh playing out well we've seen some weakness and we've seen a breakdown of some of those areas here in fact as i mentioned earlier on twitter for instance at j mcnichol underscored tda did post a tweet uh on top of watching ozark for the weekend and doing some military stuff seeing off my son going up the train with the canadians and some of our other allies up in the great great white north but we did get out a uh talked about april as far as on the monthly closes now these are on the cash indices and you know a lot of pain being felt uh from this last month and in many cases particularly with the nasdaq pain being felt going back to the beginning of the year uh is you know recognizing things as as a ratio and that's where fibonacci has a tendency of uh showing us is you know things are relative on how strong of a run-up that we've had from the previous year at least going back to october of 2020 and in other cases obviously going back to the lows in march of 2020 is you know how significant are these pullbacks now in the case of the s p uh we haven't even pulled back half of the run up from october of 2022 and that's actually somewhat common uh when it comes with trends no matter how painful that may feel and being in more of a correction territory pulling back at least 10 percent so you can kind of see where some of those levels are in this case from a longer term around closer to that 4000 level which we're still about 100 points away from that if we fail to find some support sooner likewise with the nasdaq which has been beaten up strongly it did fail uh for the month below a critical uh fibonacci retracement 61.8 level again this is going back to the uh lows uh in october or in the last quarter of 2020. notice that it tried to hold it in the previous two months had got relatively stronger bounces april didn't play that way and went ahead and broke down you can see where some of the longer term levels can come into play for instance fully retracing where the nasdaq had broken out back in october of uh 2020.
uh likewise with the russell uh that has overall struggled and we know had been going much more sideways for going on a year pulled back significantly as well taken out lows from previous months but interestingly still holding or still above kind of that 61.8 retracement kind of hiding the fact on how strong the small caps rally was going into 2021 even though for the good part of that year had struggled in the second half of that so some areas to be keeping an eye on from a longer term to see if that fear continues to build on itself okay uh so hopefully you found that helpful and uh you know possibly another reason why to kind of follow along uh with uh with us on twitter there to again learn more about your instructors and and also uh some things that we may review on an ongoing basis there okay so now that we've looked at the overall market there let's go ahead and get into the active trader portion of the application now this is not necessarily uh has to be tied exclusively to futures uh but uh since uh in this class we have done examples of uh more intraday examples of trading uh the active trader portion of the program uh could be a relatively easier way to be able to quickly place trades uh close them out reverse trades and we'll go through some of that functionality here so let's go ahead and bring that up as we go back to the thinkorswim platform once again like to thank ken for helping out on the chat and we do have quite a few people there so if you do have questions uh please be patient we'll try and cover down the best we can there uh so looking at the thinkorswim platform we're on the chart tab and you'll notice over here on the left-hand margin of the platform several buttons notice the c is actually highlighted that's because we are looking at a chart if you accidentally happen to click it and you're wondering why you can't see anything on the chart the first thing you should do is come over here and make sure the c is checked i've caught myself doing that a few times but there you go and if you scroll up a little bit you'll see a t for active trader now if i go ahead and click on that that'll bring up the active trader portion of the platform now also if you're happen to be on the trade tab there is also a sub tab for active trader uh that'll bring up uh some something similar to what we're looking at the other page uh by default it brings up at least two charts and two active trader uh windows there okay now as far as simplicity we'll just focus on the one window so we're covering up quite a bit of real estate uh again we're looking at an example of forward slash mes which is the micro contract we were using this as an example of a hedge from some previous weeks we had showed you on hedging an account with futures with what's been going on in the market over the last several weeks and beyond this hedge has been positive from that regard continues to do so today full disclosure though our long call spread on the treasury bonds looking for a counter move to the upside we actually started seeing that last week it did fade a little bit uh and we're kind of back in that range there forward slash zn which represents the 10-year treasury had been forming a bit of a base we were looking to see if we were going to have a counter move and at least uh over the nearer term uh trade up into the 120s 121s we have yet to see that so we'll see if that fails or not with about 18 days left going back uh on the active trader uh you'll notice that it will keep track of uh if it's an open position your number of contracts and here we're short one contract shows the average price for this so this was initiated when the s p futures were trading at about forty four fifty okay uh shows p l open as well as uh your p l for today now if you come over to the side uh there is an actions menu if you do wish to customize uh what is being displayed you can do that uh although there's something to be said for simplicity there pretty much have everything we need as far as the example in that position now if you go up on the top uh you'll see several buttons going across and some of them are self-explanatory where we have an example of buy market that will go ahead and when one clicks on it will bring up an order and whatever your default orders is in this case one contract uh to buy that future now notice it brings up a confirm and send this is would be a personal decision on one utilizing that with confirm and send we can double check as far as what the order is versus doing a fat finger if you need to make changes you can come here and select edit there is a function on the active trader which is called autosyn uh with this auto send with that checked if i click on buy it'll go ahead and put in an order to buy at the market and would not uh give you a confirmation now since i already have a hedge on here let me go ahead and look at forward slash es for those of you that are relatively new at futures you know again these are examples of index futures for the s p 500 uh forward slash es uh has a multiplier of fifty dollars per point uh and that's denoted in quarter points so twelve dollars and fifty cents per quarter point also the amount of margin that's required uh to trade it in this case twelve thousand three hundred uh could be significant with someone with a smaller account uh likewise forward slash mes which is the micro contract is a five dollar multiplier so therefore uh significantly less as far as initial margin um you know about ten percent of the leverage uh that we had saw on forward slash es now just because it's a lower margin doesn't necessarily it does not mean that there is no risk with that as uh that equity needs to be maintained uh if uh prices go against you there so we're looking forward slash es notice i'm not showing a position uh currently it does keep tabs of p l uh for today so from a little intraday pre-market uh trading there cleared it out for this class so just to kind of show you on the auto send if i click on buy notice it went ahead and initiated a market order did it right on the fly okay and as you can see uh how quickly things can change as basically bought as the market's uh falling there okay if i want to go ahead and close uh uh if i want to create a short position i can go ahead and do that by clicking on cell however if one's maintained in an existing position notice there's some other buttons here for instance reverse and flatten if i wanted to switch my position to the opposite side if i click on reverse and notice i'm doing the auto send because there's no confirm and send what that did is it basically closed out the existing position and went short uh the same amount so now we're maintaining a bearish position here okay and as you can see things can whip back and forth you can see my daily gains doesn't appear in there okay uh now there's also what's called flatten and uh this is uh uh be useful here and i'll i'll show another example uh with it but uh what flattened does is it basically closes out any existing position on that contract and likewise if there is any open orders on the platform it will cancel them it does what it intends to do it goes flat so if i click on flatten here or here i'll do this as an example let's say i wanted to put in a a stop order which is not guaranteed to fill at a particular price once filled it'll compete with other income and market orders so if i go here's an intraday chart look at here i'll click on a t for active trader and as we go and pull this back here so we can see it now again this is showing a bearish position let's say i was looking at a stop that was above that current market in fact let's go ahead and reverse again we'll do that now keep in mind every time you do a reverse uh those are commissions uh that are being paid here so you know looking at the s p you know from the lows in the overnight went a little lower you know potentially seeing a bullish reversal at least on that five-minute chart you know let's say when it set a stop uh below uh that level now if you're on the chart you can actually right click near that price and you can go ahead and you know create a sell order and then go ahead and edit that to make that a stop loss like a stop gtc you can double check that price and do a confirm and send and we'll send that through okay and so notice there's a work and stop order below that low now if you're on your active trader it should also show on uh the price levels here you may have to scroll down a bit here as you can see where those price levels are and so notice uh we have a working stop right here at forty dollars ninety six cents or correction four thousand ninety six fifty now as far as adjusting uh stops we've showed you on how one can go ahead and adjust it on the charts by just left clicking and dragging you should also be able to do that on this scale here as well if i go ahead and click on this and let's say i wanted to raise that stop up a little bit you can just go ahead and left click and drag it would give you a confirm and send here although let's uh let's go back here and uh let me delete that let's click the auto send and if you're on auto send you should be able to slide that and it should go automatically through okay went ahead and made that adjustment from that 4096 up to 4097.25 so this could be a time saver but it doesn't give you a margin of error if you go ahead and do the oops trade and kind of fat finger it okay now if uh let's say it's at the end of the day uh haven't been stopped out or you know have you reached a particular price level or whatever expectations were not met but you want to close out everything that's where that flattened button would come in if i click on flatten you'll notice that it should fill or close out this trade and likewise it'll cancel any additional orders that are on there so i'm going to click on flatten and notice it went ahead and closed out the position and canceled any existing orders all right all right so we kind of went over these top buttons here now if you come a little bit lower you'll see the quantities and the default quantity is going to default to 1 here however uh one can go ahead and change this to a basket of contracts depending on what size they wish to initiate i'm going to uncheck the autosend here another thing that we have here is what's called a template and we've utilized this in this class in the past as well you can see i've created quite a few different brackets if you go up to the top a common order type for active traders is a a trigger with a bracket order if i go ahead and click on trigger with a bracket order you'll see what happens here is we have an order let's go back to one contract and attached to it is a bracket order now it's a little truncated here do apologize uh with the fonts but if you look a little closely one of these is it's offset by one point to the up side and one point to the downside so we have a limit along with a stop you can go ahead and change the time and force you know for instance the gtc now notice when i start changing this there's a little save icon here so a common one that we've done in this class as an example with the s p is creating a bracket order that's offset by 20 points up and down and this could be a moving target depending on the instrument you're looking at uh even in this market for how volatile it is uh 20 points could be a move in in in seconds to minutes nowadays but trying to set construct something that's going to be a little outside of that more recent trading range okay now notice again i created a 20-point bracket they're both checked and there's that little save icon if i click on that save icon you can go ahead and name this uh whatever you'd like you know let's say 20 point bracket and then click save now i've done this a few times but just to kind of illustrate that once you save it it should now be part of your personal brackets here and so for instance i do have one here that's a 20 point bracket gtc and if i was to go ahead and just go ahead and select uh buy notice it defaults to a market order and if that once that gets filled it will go ahead and put in this bracket order plus or minus 20 points okay now if i go ahead and delete this and again you can utilize the auto send as well if you're confident in your uh selections there without confirm and send again there's challenges to that if i go ahead and click on buy with that auto send notice when it did it went ahead and bought the order and it created that bracket order that's weird it's not showing on the chart oh you know what maybe i backed out of that let me try that one more time i'm going to go ahead and flatten this definitely doing some examples of traits here today let's bring up that bracket oh you know what i i think i may have deleted it let's click on that there so there's that order there uh we got 20 points up or down i'm going to go ahead and click buy on that and notice when i do buy it'll actually show the bracket orders over on the side there so i'm going to click on this let's see if it does it right this time all right there we go not sure what i did the last time but there's those bracket orders that are showing on the chart now now again these could be adjusted here uh on the chart itself or if you are looking at it on the active trader uh you know you can go ahead and scroll and adjust these as well okay and with the auto send it'll go through automatically if you don't have the auto send it'll be a confirm and send okay now let's go and take a look at some of your questions since we have covered a lot of ground uh we've got a few other things to cover here as well hopefully you're enjoying the presentation and you do have an opportunity to uh let us know there is a uh a like uh icon there if you click like that'll let me know you enjoyed the presentation uh also give an opportunity for other people uh to see uh the functionality of this platform in this case with the active trader platform so do appreciate the support and if you are very new as well you may notice that there is a subscribe link on the bottom of the screen you've reached the active or the trader talks channel at td ameritrade we have over 30 webcasts a week and if you want to be informed of those webcasts go ahead and click subscribe and you can turn on notifications and you can be alerted to various sessions to include getting started with technical analysis which is going to be with cameron may here uh at the top of the next hour here all right so we've uh looked at some of those current market conditions we've uh been demonstrating the active trader platform as well as how to place a trade on active trader i want to make sure we're getting your questions answered here and one of the questions concerns uh you know buy uh ask us or sell uh as far as selling the button as far as with that order in there so remember when we're doing a market order the market order is basically going to uh buy at the ask price uh typically whereas the sell market would usually be uh at the bid price now if one wanted to for instance if you're not using the auto send uh you can go ahead and you know click on the buy and you can edit the order to change it to a limit order if you wish okay and you know for some of our trades and setups whether looking for a buy stop or looking for the order to pull back to a pivot point uh you know one may consider that you know again i can go ahead and right click on the chart and do a a buy single and that will go ahead and bring up a limit order all right uh if you oh i'm not sharing my full screen my apologies there let's go back to that show that one more time there we go click on the wrong button uh as i was saying uh right up here at the top you have the buy market uh that's going to be buying at typically the ask sell or correction uh yeah buying would be at the ask cell would typically be at the bid all right if you want to make it a limit order again if you don't have the auto send you can click on that and then select edit the order change that to a limit all right if you're doing it on the chart as well you can by default uh that'll typically bring that up as a limit order now if we another way of doing it uh is if you're looking at the active trader down here all right uh now by the way if you're kind of scrolling through here and you kind of get lost okay where's the price uh over here there is a little arrow it's kind of a center and arrow there are two arrows with the center you know if i'm scrolling down and and kind of off the page here you can go ahead and click on that that'll re-center you and as we're looking at the market we're seeing the current price being traded you can see the uh ask side and boy things are moving fast there okay uh you can see how many contracts are on the ask price you can see how many contracts that are at the bid price at that best market okay if you look over to the far side you can see where a lot of the volume has been at different price levels there's different ways of visualizing uh volume but this shows you the number of contracts that have traded at that price some traders may look at that for some ideas on support and resistance okay uh let's see some other things and and we'll address on the option side there uh if i go back on the center here i believe if you uh if you go ahead and select a buy that's underneath the market okay and we'll click on buy notice that will default to a limit order okay let's go ahead and delete that if you put in an order that's above the market okay notice it defaults to a stop order and this sum i've talked about at length for those of you that have done these types of trades remember a limit order is a better price a stop order is a worse price so if you're buying under the market that would be a limit order if you're buying above the market that would be a stop order so the active trader will be smart and default to that okay it does give you the option though if you are trying to do let's say a marketable limit order what some traders may do is put in a limit order that's a little bit above the market and you can do that by hitting the control key as you hit that buy and even though it's above the market it'll be a limit order and if it's at that price or better then it'll go ahead and be filled okay all right so a lot of things we covered down here uh on the active trader platform um and there's probably a few other features but i want to focus on some of the major ones here uh likewise as i mentioned we can see our brackets here there's our limit order to sell if the price goes ahead and trades higher price keeps going down a little bit more it'll end up being stopped out here now there are some other features over here that are not necessarily tied to the active trader but some active traders may look at that such as time and sales if you click on ts for time and sales here are all the trades that are coming through along with their size kind of reading the tape as some traders may look to see where that momentum may be going there let's see anything else that may uh stick out uh level two which is more for uh equities not necessarily on the future side here uh one can see the market participants which translate into that bid and ask uh on the platform so another active trader tool uh not uh applicable to futures in this case and again you can come over here and uncheck or check those however way you'd like now the question was can you do options on this i suppose theoretically you can uh however what it would require is to uh input that specific option and so if i come here let's say we go to uh and i'll bring up since we're sticking with futures uh although one can apply this to uh equity as well we would require one to do is i believe go ahead and copy the symbol itself and some of these symbols can be pretty convoluted so if you go ahead and you right click on a symbol on an ask price or bid price you can go ahead and copy that symbol come here go to the chart tab and let's see if we can paste that in there there's the symbol and see if the data comes up on that maybe i chose a wrong example let's go ahead and actually look at an equity just for our example here let's do something that may be traded here so i'll right click on the option symbol will select copy by the way some people are interested in charting options uh i don't uh i i don't have a similar opinion on that but that's uh to each their own but there's a chart of the option and here you can see the quote for the option here you can see the ass size and if one wanted to buy the option they can go ahead and do that but as you can see that did take a little bit of time to kind of translate individual options into the active trader but nevertheless it is possible all right let's see what else we got going on before we wrap things up for today we'll take a look at some of these major uh market indices on the future side and again we have that practice trade in there things look like they're still kind of faltering or at least trying to form a base from the overnight at least on the s p futures seeing if these lows hold looking at the nasdaq forward slash nq as an example maybe a little more positive as we've gotten a little bit of a lift from the opening still hasn't quite broken out of the highs from overnight you can see it acting as some resistance so traders may be keeping an eye on some of these levels and there's another fib level there to see if prices are able to break out psychologically for the nasdaq would probably be above that 13 000 area let's look at forward slash rty which is the small cap futures small caps had made some multi-month lows but looks like trying to hold the lows from the overnight hasn't quite broken above the overnight high range i got a daily pivot point at around the 1880 area weekly pivots are at around 1890 so psychologically for the week if the russell's able to get above 1900 and hold that could be more sign of a near-term bullish reversal and as you can see pivot points don't look so hot on a daily chart we have to go to more of an intraday chart in gold you can kind of see these weekly pivots how the russell has remained below there uh so looking to see if there's any signs of that potential reversal and let's go ahead and take a look at the the dow futures forward slash ym again kind of hanging out around the low range from last night and you can kind of see some of the areas where some potential reversals may come into play psychologically for the dow looks like it would be above the 33 000 as an example looking to see if it's able to make some higher highs versus lower highs and lower lows okay let's go ahead and just highlight a couple other features since i know that many of you may be new to this webcast to answer the question hey we'll be you will we be utilizing active trader again in the future yeah absolutely if we're looking at some intraday examples uh to trade we'll have that active trader window open and place in those trades i want to use this session as more of a deeper dive that people can go back and reference to to have a better understanding of that okay and it looks like ken's sharing some information there thank you ken and if we go ahead and take a look uh td ameritrade dot com forward slash futures folks is a great resource for you to learn more about futures i'm going to paste this link in the chat for those that are live uh those of you that are attending in the archive session which i do appreciate it uh feel free to click like too if you enjoyed the session but here td ameritrade.com forward slash
futures you'll see links to education resources how to start trading including opening up an account and work on that approval uh considerations on trading futures as well as with some of the available products and i know we ran through a few examples here today if i scroll down under available products such as stock indices you can go ahead and see that we had the forward slash es you know there's the micro contracts you know nasdaq and some of the other indices there uh we've also highlighted on the interest rate front you know there's the 10 year note the treasury futures and probably in upcoming sessions here we'll talk a little more about things such as metals energy along with agricultural utilizing some defined risk particularly with index futures options all right okay well i would encourage you to practice what you learn here today folks with the active trader on paper money maybe pick one of the widely traded future contracts on the index futures and utilize that keep in mind though that uh for instance with that stop order as we mentioned it's not guaranteed to fill at a particular price once triggered they'll compete with other income and market orders and remember in order to demonstrate the function out of the platform we did have to use actual symbols keep in mind td ameritrade does not make recommendations or determine suitability of any security or strategy for individual traders any investment decision you make in your self-directed account is solely your responsibility so have a great day folks appreciate the support we'll talk to you again real soon bye now [Music] you
2022-05-04 00:03
