At FXIFY Futures, we prioritise the safety and protection of our traders by ensuring they avoid high volatility and risky market conditions. One of the key measures we have in place is a strict guideline that prohibits trading when a product is within 2% of a CME price limit. This policy is designed to shield traders from extreme market fluctuations that could result in significant losses or leave them with open trades during a market halt.
What is a Price Limit?
A price limit refers to the maximum allowable price range for a futures contract during a trading session. When the market hits the price limit, various actions may occur depending on the contract being traded. These actions can include a temporary halt in trading until the price limit is adjusted, a continuation of trading within the price limit, or a market halt for the remainder of the day, in compliance with regulatory rules.
This policy applies to all FXIFY Futures accounts, not just during evaluations.
How to Check Price Limits for the Contracts You Trade
Price limits are calculated based on the end-of-day settlement price and can vary by product, contract month, and the time of day. Specifically, overnight price limits are different from those during business hours.
Price limits are updated after each trading session at 5:05 PM EST and can be accessed on the CME Price Limits page.
For example, equity products such as ES, MES, NQ, MNQ, RTY, M2K, YM, and MYM have an overnight price limit of 7%.
How to Avoid Trading Within 2% of Price Limit
One of the most effective ways to ensure you are not trading too close to a price limit is to monitor the percentage net change for the contract you are trading. This can be done easily via your trading platform’s quote board or radar screen. Most platforms allow you to view the "Net Change" in percentage terms, and you can add the "% Net Change" column to your quote board if it’s not already displayed.
For example, if you are trading a product with a price limit of 7%, you should stop trading if the market reaches a 5% gain or loss for the day. Any further movement would bring it within 2% of the price limit.
Why is This Policy Important?
This prohibition is in place to safeguard our traders from being "trapped" in a market halt after their orders are filled. Trading near or within price limits carries the risk of facing sudden market halts, leading to potentially significant disruptions in your trades. By ensuring that trades are not made within 2% of a price limit, FXIFY Futures aims to protect both the firm and its traders from such risks.
Additionally, we expect all traders to have a clear understanding of the markets they trade. Familiarity with contract specifications and price limits is vital for making informed trading decisions.
For more information on the products you trade, we recommend visiting the CME Group website, where you can find detailed information on contract specifications and price limits for each product.