EMINI NQ vs. ES

I have been trading the nq futures for about eight months. I have never traded even one contract of the es futures. Is there any difference betwwen the two contracts? is one of them better than the other. The only reason I chose the NQ is because I used to trade nasdaq stocks. This forum is the best web source for good info so any and all replies are greatly appreciated.

 

I am not an expert and I don't know if it is true, but I have seen it said that the NQ tends to display more trendiness than the ES, which is choppier.

 

larrybf: “Is there any difference betwwen the two contracts? is one of them better than the other.”

I watch both and I’ve traded both. I prefer the ES but that may have more to do with the fact that I’ve traded the S&P for much longer.

Depending on which I feel may offer more potential profit at any given time I will take a position accordingly. Truth be told, though, I’m almost always in the ES.

This is purely anecdotal but I find the setups on the ES to be more readily defined. Often I find the NQ to be slightly noisy in comparison. Interestingly, though, I find the NQ more predictable in terms of exhaustion points.

It has not been my experience that one leads the other, as I have heard form different traders. I find that they tend to switch off and that relationship offers me insight into opportunities throughout the day.

dufferdon: “I have seen it said that the NQ tends to display more trendiness than the ES.”

Yup. Down!

 

is one better than the other ?
that depends on what you want to do.
differences ? well, I think the only one objectively is volume. ES has more volume at any given time. Although it does not move that much, but I have seen, even recently NQ dies with very little price change because of lack of volume.

When NQ moves, it MOVES though. This causes more parabolic accelerations and therefore trends are clearer visually. However ES and NQ are fantastic instruments.
At the moment I am activating trading on both ES and NQ with different systems. It is great to be able to trade them at the same time.
The tragedy in NYC caused difficult trading conditions within my risk parameters (with higher risk tolerance the markets were great almost everyday).

I do think ES has a better record regarding fake signals. NQ, because of its acceleration capability can force you in a trade and kill you 15 minutes later.. That's actually my experience with my trading style. This is why I am quitting NQ for longer holding periods and am actually switching to ES. (NQ used to be very predictible in the down trend tymjr is so right).
But NQ is great for quick almost scalp types of moves, when volume is there. There are obviously many other robots and machines trading this, so it offers opportunities for highly automated systems to play with or against them depending on the conditions.

As far as influence is concerned. I am not convinced at all. It is not rare that ES and NQ go in opposite directions. If you take the reversal in one as a trigger for the other one, you might pay a high price for that belief.
I even remember last week a drop of 20 points in NQ on news out, and ES barely had a downtick.
Imho, don't try to play ES or NQ against the other.

neo

 

I have been trading stocks at IB and want to switch to the ES/NQ because of the new 25k rule. IB does not offer day trading reduced margin though. Do any of you know of any other firms that charge only $2.95 per trade like IB but offer reduced day trading margin. Thanks for any help. I hope the SEC changes these new day trading rules. I find it interesting and ironic that the NASD will change their own rules when it suits them, ie. stocks trading under $1.00 per share will not be delisted until Feb 2002 or later if at all.

 

Do a search on this site for "futures broker" and you will get numerous threads that might help you.

If you spend at least $500 per month in commissions, www.elocaltrading.com offers $1.50 + fees per side with daytrading margins...it will save you about 80 cents or so after fees per trade versus IB, but they charge a minimum of $500 per month.

But remember, even with standard margins, futures are giving you almost 10 to 1 margin, versus your stock account where you only got 2 to 1. Is it really necessary to have 20 to 1?

Kirk

 

tntneo: “I do think ES has a better record regarding fake signals.”

I completely agree. Ironically, I think this one of the reasons I find it easier. I spent so much time playing the game that I feel much like an NYSE trader must feel when reading a specialist.

I also think that my strong sensitivity to fake outs can hurt me, at times, as I will tend to discount those trades that appear blatantly obvious. That is why I have developed some solid rules regarding characterizing the market. It can keep me from reading too much meaning into a potential setup.

I believe integrating your observations of the locals’ behavior as well as that of the dealers’ is highly beneficial, but it is only an adjunct to a solid system. A filter, if you will, that can serve you if used correctly. At least, this is true for me.

“If you take the reversal in one as a trigger for the other one, you might pay a high price for that belief.”

Agree, again. Just to clarify, the opportunities I mentioned relate to observing not only the relationship but also the events and indications of both, separately. In other words, the trade must stand on it’s own, although, certain conditions may influence me to be more or less aggressive.


jskeldon: “Do any of you know of any other firms that charge only $2.95 per trade like IB but offer reduced day trading margin.”

http://www.elocaltrading.com./html/main.isx

http://www.futurewisetrading.com/serv02.htm

http://www.manfutures.com/index.html

I believe each of these offers inexpensive roundturn rates. Not sure about daytrading margin, with the exception of elocal, which WarEagle has already pointed out.

If capitalization is a concern then you may be interested in the mini Dow on a/c/e that will begin trading Sept. 30.

http://www.elitetrader.com/vb/showthread.php?s=&threadid=2341

Depending on commissions and liquidity, it may be a viable alternative.

 

The new mini Dow looks like a great vehicle when you consider the volatility and intraday trends of DJIA. The tick value would also allow you to keep losses small I think, great for beginners. However I looked at a delayed 1min. chart of the full contract (on Livecharts) and it doesn't seem to be a very active contract, the chart doesn't give much info. The cash looks better in that regard. So could you trade it off the cash? Which BTW would save you the CBOT exchange fees.

 

Kicking: “I looked at a chart of the full contract and it doesn't seem to be a very active contract…”

Yup. The large contract is a bit of a sleeper. We’ll see if the mini can breath some life into the CBOT’s equity index futures.

 

Thank you all for the great informative replies. Now to be very specific. I trade in the morning only. I got tired of having winning mornings and then giving it back later in the day. MY trade duration is 3minutes to as long as 20 minutes(when i am in a strong winning trend. MY time frame is 1 minute charts with stochastics(14,3) as my lead indicator supported by bollinger bands and 20 period moving average. NOW given my trading parameters should i stick with trading the NQ or should I switch to the ES mini. I am making money now but like everyone find myself "faked out" often utilizing my present system.