switching from ER2 to ES

I've done both (gone back n forth) as volatility levels change and currently I'm trading ER2 exclusively because my trading style still performs best on ER2 in comparison to ES as long as the volatility doesn't change into something I can't exploit.

Profitability didn't change.

The change occurred in when I traded size because with ER2 I'm a little more careful what time of the day I do size whereas with ES it doesn't matter.

P.S. I will switch again if volatility in ER2 changes when it begins trading on its new exchange - ICE.

Mark

 

Thanks for the info.

 

I traded the ER through IB all day today.

Lot's of misinformation regarding its' demise.

I, also, trade the ES.

Easiest way to scalp the ES is to watch price action around the "classic pivot points". You'll quite often get taken from one level to the next for 5-7 handles.

It seems like a 3 point stop on the ES is much safer than a 15 tick stop on the ER2, although, you might be able to scalp 10 ticks on the ER2 during a 1 handle range on the ES, so it's "good and bad". lol

 

Thank you brownsfan019, increasenow, NihabaAshi, and DonKee.

Very interesting point about time not really being a factor on volume in ES. ER2 the volume usually drops off dramatically 1-2 hours after the open and action becomes more random. And it's usually when I stop trading. Interesting also about heavily defended areas and pivot areas.

wrt ER2, it doesn't matter what you call it, I think there will always be a small cap index based futures traded with volume either at CME or ICE. Doesn't matter to me as long as it tracks the RUT.

Thanks again all. Your P/L will probably benefit from my beginner mistakes over the next few weeks on the ES.

 

hypostomus

You are right, the spydertrader, Jack Hershey version of noise trading is kind of a takeoff from the movie "The Sting" where all the observations, calls , claims etc are DELAYED just like they called the hores race AFTER THE FACT. Nice work, i want to say where do you get such insights to want to call any detractors "assholes"? Lots of education go into those observations or do you speak from experience od being one of them yourself?

HOG OUT!!!!

 

I trade ym, nq, russell, and es all with the same system. I just change my position size and profit / stop levels to adjust for each instrument to hold my similar risk to reward range. If your method is simple it can be used on more than one index imo.

 

Bandit,

Tell us a little more about your trading style on the Russell and folks will be better able to answer your question.

If you're doing very short-term trading then moving to the ES could be a significant change. If you're shooting for the bigger intraday moves or swing trading, then the differences will be fewer (i.e., your basic strategy might still be valid, but your execution might need tweaking). You might also need to reconsider the order types you use (limit vs. market vs. stops) for entries and exits.


Regards,

 

Yes, I do very short term trading on the ER2. My average hold time is 10 minutes, and I try to capture $0.50 to $2. Will this be a problem on the ES as it jumps less and has more volume (and hence takes more time) to move the same number of ticks?

 

I have been scalping ER2 and occasionally ES and switched to Crude and now to DAX.

ER2 and ES are totally different animals when it comes to very short term trading or scalping. A short term trader/scalper would have 4-5 times more opportunity on the ER2 then ES because ER2 zigzags more around the imaginary mean.

For example when I scalp ER2 - usually from 2-5 ticks I fade the market. Very often within seconds I get my target hit.
In ES I would not fade the market because it is less likely to retrace. As other posters pointed out it shifts from one level to the other but how manytimes of the day? Not that many.

ER2 is not that liquid so it is more likely that on the first touch of my resting order I get a fill while with ES it is not likely.

I started scalping Crude which is a very good trading vehicle and I have outlined the reasons why I prefer it over trading the indices in my thread "Some observations on scalping Crude".

Recently I started trading DAX and I love it . It has long trading hours. 2AM- 16PM EST, always liquid with great range. The commission at IB is 2.22 roundturn for (unbundled pricing) which is also useful if one trades frequently. It is a huge contract +- $250 000 and there are many price points to build nice price patterns.
I trade off the 16 second bar chart and the volume patterns are very clear and in one hour there are more opportunities to make a couple of bills then in an entire day of ES.

The only thing is, because it is a huge contract I don't dare to fade the moves and I had to teach myself to scalp with momentum rather then against it.

There is an interesting time in DAX between 2AM and the time the US markets open, I swear it's less nervous.

I would recommend anyone trading momentum rather then value test trading DAX as it has all the characteristics of a super trading market.

IB symbol underlying DAX, SierraCharts symbol DAX-200709-DTB,
TS symbol FDAXU07.

Regards,

GC

 

Thanks GC. I'll do a search for ES scalping and see what I come up with. DAX hours are a bit early for me. Does Tradestation have a good DAX feed? What do you use for DAX datafeed/charting?