The forward curve is a snapshot of active futures contracts ordered by delivery month. It lets you see whether later contracts are priced above, below or near earlier contracts.
How the curve is built
Take the latest comparable price for each active delivery contract and plot those prices in chronological order. The resulting shape can rise, fall, flatten or change direction.
What an upward slope means
An upward segment is local contango: the later delivery contract trades above the earlier one.
What a downward slope means
A downward segment is local backwardation: the later delivery contract trades below the earlier one.
See the current curve structure
Open the Forward Curve to compare active delivery months and identify rising, falling or mixed sections.
Open Forward CurveWhy local segments matter
Calendar spread traders care about the exact section containing their two contracts. The overall curve can be mixed even when one specific pair is clearly in contango or backwardation.
Forward curve vs seasonal chart
The curve is cross-sectional: many delivery months at one date. A seasonal spread chart is historical: one contract relationship through time. Using both gives current structure plus historical context.
The forward curve is a snapshot, not a time series
A forward curve answers one question: how are different delivery months priced today? A seasonal chart answers another: how did one contract relationship evolve through time? Confusing these two views can lead to weak conclusions.
Use the curve to understand current structure, then switch to the seasonal spread view to study the historical path of the exact month pair.
How to compare curves through time
One curve snapshot can be useful, but repeated snapshots are even more informative. If the front of the curve is flattening while the back remains unchanged, that can signal a shift in nearby supply and demand. If the whole curve moves in parallel, the relative calendar spreads may change much less.
This is why curve research should separate level from shape. A commodity can rally sharply while the curve shape remains almost unchanged.
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Frequently asked questions
Is contango bullish or bearish?
Not by itself. Contango describes the relationship between futures delivery months, not a directional forecast for the underlying market.
Is backwardation always caused by a shortage?
No. Tight nearby supply can contribute, but curve shape can also reflect demand, inventory, financing, convenience value and expectations.
Can a curve contain both contango and backwardation?
Yes. A mixed curve can have rising sections and falling sections at the same time.
Why does curve structure matter for calendar spreads?
A calendar spread is one segment of the curve, so changes in the curve directly change the relative value between the two delivery months.
Research the curve and the spread together
Use the Forward Curve for current structure, then compare the same contract relationship in historical seasonal data.
Open Forward CurveFutures trading involves substantial risk. Curve structure and historical patterns are descriptive context, not guarantees of future results. This material is for education and research only and is not investment advice.