Which Emini Has the Best Intraday Trends

[futurebondtrader 10]

Hello,

 

Just wondering of the eminis available (ES, NQ, Dow, and Rusell 2000) which one has the strongest and smoothest trends if one is into intraday trend trading?

 

Thanks

[astralmarket 10]

After working on all 4 for few years I found that TF Mini Russell 2000 is the best bet for intra day moves. ES is only good for market makers or very big players.

NQ and YM are inconsistent and require great deal of observation and practice. They prove to have never been gainful trades in my case.

Best so far has been Russell 2000 futures despite its lesser liquidity.

You have to observe it for few days and you will find it much more interesting and clearer trends.

[amatulic 10]

Those are all highly correlated markets, so it really doesn't matter. I have ES, TF, and NQ displaying at the same time, and I use the price action on one to validate decisions I make on another.

 

That said, I have noticed a certain trend-continuation entry signal I have works best on TF, worst on ES. NQ and Dow are so-so for that signal, not worth doing it on those.

 

You could try the agricultural contracts like ZC too.

 

For a good-trending market, try CL. Fast moving, strong trends, but unforgiving of mistakes (that is, if you make a wrong entry on ES, it's easy enough to get out at the same price, but not so easy on CL). If your usual trade duration is 15 minutes, stand aside at least that long before the crude oil report comes out.

 

-A

[astralmarket 10]

I agree Amatulic.

Good points really.

 

CL is not for some one without experience. It can be incredibly fast or sluggish.

At times it follows all tech rules and other times it can be treacherous to say the least. I mean all this in minute trades.

[amatulic 10]

The best thing about CL, though, is that it's a great market for learning price action. Of all the markets, CL seems to adhere the most to chart formations, elliott waves, double tops and bottoms, and so on (at least on time scales of 3-10 minute bars); everything a trader would want to practice charting trades without indicators.

 

-A

[sunxpert 10]

I would suggest 6E. CL is too fast for a beginner and too noisy as for me.

[MightyMouse 12]

  astralmarket said:

After working on all 4 for few years I found that TF Mini Russell 2000 is the best bet for intra day moves. ES is only good for market makers or very big players.

NQ and YM are inconsistent and require great deal of observation and practice. They prove to have never been gainful trades in my case.

Best so far has been Russell 2000 futures despite its lesser liquidity.

You have to observe it for few days and you will find it much more interesting and clearer trends.

 

Each of the instruments you have mentioned generally or largely follows or leads the other and generally end up in the same direction for the day which means that you can trade ym by watching es. YM and ES move in the same direction about 98% of the time.

 

If the question asked by the OP is really: which emini is easier to make money with?

 

Then, the answer is none is easier than the other. There are traders trading each that are ready to steal lunch money from new, naive entrants.

[wrbtrader 10]

  futurebondtrader said:

Hello,

 

Just wondering of the eminis available (ES, NQ, Dow, and Rusell 2000) which one has the strongest and smoothest trends if one is into intraday trend trading?

 

Thanks

 

I'm going to assume you're asking that question because you want to be a trend trader in either the EMD, ES, NQ, TF or YM futures products.

 

It's a very simple solution...backtest your trend trading method on all of them and then determine which of them to trade for intraday trend trading based upon the backtest results of your trade method.

 

My point is that someone that replies via saying for example NQ is best or TF is best or YM is best or whatever...their reply is based upon their trading style, their trade method while trading that specific trading product. Thus, unless you're using the exact same trading style and trade method...their answer will lead you into trading something that will most likely not be suitable for you to trade.

 

Thus, to avoid any problems, just backtest your trend trading method and you'll easily answer your own questions about "which emini has the best intraday trend".

[smmatrix 11]

Of all these markets, I prefer counter-trend scalping S&R levels on the ES. And trading, with-the-trend, trying to catch big moves on crude and gold.

[Momentum Chaser 10]

While it is true that these are all highly correlated markets, there are some large differences in the way that they trade every day. I like to trade where there is the most movement and trend.

 

I look at these markets from a mathematical standpoint by looking at 3 things:

 

The AverageTrue Range In Dollars

The Open to Close Range to Average True Range Ratio

The Current Initial Margin Amounts.

 

Currently as of March 3, 2012. The 10 day Average True Range computed in US Dollars for the 5 markets is as follows:

 

TF $1,501 per day range

EMD $1,366 per day range

ES $647 per day range

YM $544 per day range

NQ $532 per day range

 

So, my observation is that the same intraday swing in the TF is almost 3 times a large in dollars as the YM and 2.3 times as large as the ES. Or put another way, if your goal is to make $500 per day trading one of these markets, you would have to net approximately 1/3 or 33% of the daily range in the TF, 37% of the EMD, 77% of the ES, 92% of the YM and 94% of the NQ.

 

How well they trend during the day can be looked at by the Open to Close Range to Average True Range Ratio. This shows the percentage of a candlestick body vs. the high to low range.

 

Current 10 Average Values are:

 

TF 51%

EMD 40%

ES 41%

YM 41%

NQ 40%

 

This suggests to me that the TF trends better during the day, while the others back and fill more. My own theory for these differences is that there are fewer scalping systems attacking and ruining the daily trends in the less popular TF and EMD, which can be seen in the lower volumes and open interests in these contracts.

 

The 3rd thing that I look at is which market gives me the "best bang for the buck" in my account by using the Current Margin Rates. I usually compare this by testing my automated system results over a period of time using the same style of system on each market versus the margin rate. A simpler comparison is the compare the Average Daily Range in Dollars versus the Margin Amount.

 

Current Tradestation initial margins are:

 

TF $7,535

EMD $7,500

ES $5,000

YM $3,750

NQ $3,500

 

To compare:

 

TF $1,501 ATRinDollars / $7,535 Margin = 20%

EMD $1,366 / $7,500 = 18.2%

ES $647 / $5,000 = 12.9%

YM $544 / $3,750 = 14.5%

NQ $532 / $3,500 = 15.2%

 

I look forward to your comments,

 

Momentum Chaser Steve