Why I like trading DAX Futures CFDs

DAX is based on German DAX 30 index  and consists of 30 major German companies traded on Frankfurt Stock Exchange.

It  is actively traded, with good volumes and volatility. Its daily range of sometimes over 100 points allows great opportunities for day trading.

Most CFD brokers require a margin amount that is not too high and will also charge you a reasonable spread of 1 or 2 points (check with your CFDa provider for details). Low margin also helps if you want to build up the number of contracts traded using the profits from the running trade.

DAX is only traded electronically i.e. no pit trading. Therefore, everyone has the same information and equal opportunity in trading. DAX volume information is available from mostly all trading platforms and brokers, in case your system uses volume analysis.

Day trading DAX

Day trading DAX Futures CFDs is suitable for Aussie traders as trading hours, in particular if you are not a morning person (like me 🙂 or if you have another day job.

DAX Futures are traded on continuously on Eurex Exchange (pre-trading, trading and post trading period) starting from 07:30 and closing at 22:30 CET. This means for Aussie traders from 16:00 AEST till 06.30 AEST. The underlying cash market opens from 09:00 till 17:30 CET and during this period the futures contract is very active.

I primarily focus my trading activity to the first part of the trading day when the cash market is also open -5pm to 1:30 am Australia Eastern time – as it also suits nicely in my daily schedule.

On most days, there are very clear two active trading periods: One in the morning that accounts for the European information and second in the afternoon when US data announcement comes and/or US market opens. It allows for increased trading opportunities for intra-day trading.

On more general point of trading, it is very clear that there is a correlation between all international markets and they tend to go up or down in pretty much same time.

In principle one can trade which ever market one chooses. However, after several years of observing/trading futures markets, I have concluded that a trader is better served if he/she selects particular market that fits into one’s daily routine and also matches with the chosen trading system.

Always remember that trading CFDs carries a high risk so make sure you know what you are doing.