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Marco Island, FL
Legendary Market Wizard
Experience: Beginner
Platform: Sierra Chart
Broker: AMP Global
Trading: MCL MES
Frequency: Several times daily
Duration: Minutes
Posts: 813 since Jul 2022
Thanks Given: 881
Thanks Received: 926
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The big difference between currency futures and spot currencies is where your orders go and who you trade with. With currency futures you are trading on a regulated exchange with other traders from all over the world. With currency spot market you are likely trading directly with your broker who is likely taking the other side of your trade. There are venues where you can trade with a variety of liquidity providers like banks but you are asking about micro sized contracts so this will likely not apply.
For euro futures currency specifically the contract is priced in 1/100th of a cent often called a pip in forex circles. In spot currency venues the currency pair is priced in tenths of a pip in many cases and which is another difference from futures.
Now, I’m assuming you know a market is made of buyers and sellers, bids and offers. The difference between the best bid and offer is the spread and the spread can differ between the futures market and spot market of the same pair. I would estimate the spread in the micro euro futures contract is only 1 tick 80% of the time, it’s a liquid market. In the spot market the broker sets the spread in most cases and many advertise 1 pip spread or less.
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