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Overnight Futures

Overnight futures or S&P 500 overnight futures are the most important trading signal for traders. The CME offers two sizes of the S&P 500 contract: the standard “big” futures contract and the S&P 500 “e-mini” contract.

The standard contract is what the institutions trade. This contract is known as the Big S&P, or the Big Car.

The Emini (or E-mini or ES) is a futures contract that tracks the S&P 500 index. It is traded on the Chicago Mercantile Exchange (CME) via their Globex electronic platform. Trading is 23 ½ hours a day, 5 days a week, using the ticker symbol ES. Each 1 point move in the S&P 500 index is worth US$50 per Emini contract and the minimum move of the Emini futures contract (or tick size) is 0.25 index points.

Weekly trading of the Emini opens on Sunday at 5pm (CST) and closes on Friday at 3:15pm. Trading is almost 24 hours a day with a short break every day between 3:15pm and 3:30pm and then between 4:15pm and 5:00pm for any scheduled maintenance.

Trade is broken into two sessions, the Day session and the After-hours session:

– Day session trading starts at 8:30am (CST) and closes at 3:15pm
– After-hours session trading starts at 3:30pm and continues until the open of the Day session the next morning

At GuerillaStockTrading.com we track the S&P overnight futures market to make early directional calls on the S&P 500 for the next day’s session. For example, if China devalues the Yuan, because China is located on the other side of the planet, the Yuan devaluation shows up in the overnight S&P 500 futures market. If the Yuan devaluation is large enough, the S&P 500 overnight futures market will be down -0.5% or more. This suggests a gap down open on the S&P 500 when normal trading begins the next morning. China Yuan devaluation is just one example. Anything happening in Europe could impact the overnight S&P futures market. Quite often, the S&P overnight futures market sets the tone for morning trading on the S&P 500 the following day.

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