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Price Limit Rule | FuturesElite FAQ
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▸Version 1July 26, 2026, 12:52 PM
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What is the 2% Rule at FuturesElite?
he 2% Rule prevents traders from participating in markets that are within 2% of hitting a CME price limit. This protects traders from excessive volatility and the risk of being stuck in a halted market.
What are CME Price Limits?
CME price limits are the maximum price range that a futures contract can move in a trading session. If a market hits its limit:
•Trading may temporarily halt.
•Trading may stay restricted.
•Markets may stop trading for the rest of the day.
Why Does the 2% Rule Exist?
1.Risk Management: Protects traders from high volatility and being trapped in halted markets.
2.Trader Safety: Reduces the risk of large losses in extreme conditions.
3.Market Knowledge: Ensures traders are familiar with the products they trade.
How Does the 2% Rule Work?
If a market’s price limit is 7%, you must stop trading if the market has moved more than 5% (7% – 2%) up or down. This 2% buffer ensures safety during volatile conditions.
Example:
Let’s say you are trading a futures contract with a reference price of $10,000 and a CME price limit of 7%. Here’s how you apply the 2% Rule:
•Upper Threshold (Stop Trading): 10,000 \times (1 + 0.07 – 0.02) = 10,500
If the market reaches $10,500 or higher, stop trading.
•Lower Threshold (Stop Trading): 10,000 \times (1 – 0.07 + 0.02) = 9,500
If the market reaches $9,500 or lower, stop trading.
What Happens If I Ignore This Rule?
This rule is strictly enforced for all FuturesElite accounts. Violations may result in account restrictions or termination.
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