GOLD Futures Calendar spread

T

traderjo

Foolishly I made a mistake in sending an future spread order without having market data + did not understand the reverse calendar spread as shown on IB and got filled for a really bad price ...
what do I do now?
Yesterday when the GC May /AUG revers ( the way IB shows it) spread was actually trading around -3.0 I put an order to Buy to open limit -0.6 and got filled
Instantly showing loss of $245 approx.
What are my options
A) Average down and buy another spread for current price of -3.2
B) Close the loosing leg ( Aug) and Sell a ATM or OTM Call option on the winning leg May ?
upload_2021-3-17_20-3-4.png

All help appreciated
 
GC K21- GC M21

contract K is not that liquid.

on quiet days, it ranges from 6 to -8.
so far, the extreme was 10 to -30.

Be careful of the coming Fed data release.
gold is going to move substantially.

Your options A & B are basically adding more trouble
as it was not part of your original plan.

personally, if I've made a mistake in my trading, I'd flatten my position
right away.
Because I don't want to have negative emotions for very long.
 
Last edited:
traderjo said:
Foolishly I made a mistake in sending an future spread order without having market data + did not understand the reverse calendar spread as shown on IB and got filled for a really bad price ...
what do I do now?
Yesterday when the GC May /AUG revers ( the way IB shows it) spread was actually trading around -3.0 I put an order to Buy to open limit -0.6 and got filled
Instantly showing loss of $245 approx.
What are my options
A) Average down and buy another spread for current price of -3.2
B) Close the loosing leg ( Aug) and Sell a ATM or OTM Call option on the winning leg May ?
View attachment 254930
All help appreciated
More...

close it as quickly as possible and move on.
 
traderjo said:
Yesterday when the GC May /AUG revers ( the way IB shows it) spread was actually trading around -3.0 I put an order to Buy to open limit -0.6 and got filled
Instantly showing loss of $245 approx....
All help appreciated
More...


When it comes to GC, the only months you should have in your head are Feb, Apr, Jun, Aug and Dec, due to above-mentioned liquidity issues. (Oct is a primary month but it never gets much traction as all the action jumps from Aug to Dec.)
 
Option C: Trade out of the May contract with a GC May21/Jun21 spread, it is currently 2 ticks wide. Now you have on GC Jun21/Aug21 on which has liquidity, currently 1 tick wide. You can either close it or hold it as your original trade. The GC contracts that have the most liquidity are Feb, Apr, Jun, Aug, Oct, and Dec. There is not much liquidity in the other months unless it is the front month, so it is best to avoid them.

From CME contract specs:
LISTED CONTRACTS Monthly contracts listed for 3 consecutive months, any Feb, Apr, Aug, Oct in the nearest 23 months and any Jun and Dec in the nearest 72 months.

https://www.cmegroup.com/trading/metals/precious/gold_contractSpecs_futures.html
 
abc1234 said:
Option C: Trade out of the May contract with a GC May21/Jun21 spread, it is currently 2 ticks wide. Now you have on GC Jun21/Aug21 on which has liquidity, currently 1 tick wide. You can either close it or hold it as your original trade. The GC contracts that have the most liquidity are Feb, Apr, Jun, Aug, Oct, and Dec. There is not much liquidity in the other months unless it is the front month, so it is best to avoid them.

From CME contract specs:
LISTED CONTRACTS Monthly contracts listed for 3 consecutive months, any Feb, Apr, Aug, Oct in the nearest 23 months and any Jun and Dec in the nearest 72 months.

https://www.cmegroup.com/trading/metals/precious/gold_contractSpecs_futures.html
More...
Thanks everybody
With Option C how would it work out P/L wise and am I adding risk?
 
Last edited:
maxinger said:
GC K21- GC M21

contract K is not that liquid.

on quiet days, it ranges from 6 to -8.
so far, the extreme was 10 to -30.

Be careful of the coming Fed data release.
gold is going to move substantially.

Your options A & B are basically adding more trouble
as it was not part of your original plan.

personally, if I've made a mistake in my trading, I'd flatten my position
right away.
Because I don't want to have negative emotions for very long.
More...
on quiet days, it ranges from 6 to -8.
so far, the extreme was 10 to -30
I am assuming your referring to the spread value If so then is it at all possible that this spread can trade back to -0.6 from current of around -3.2? and if I do average down so the average is around -2.0 ( knowing I am adding exposure) then it has to move less for me to scratch the trade
 
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