Comparison of ES and MES Tick Charts

Early on I did not have much interest in the Micro equity markets, as the low volume was an issue. New markets often take a while to build interest and volume, and some times they never really achieve a large following. However, I hoped all along that eventually the volume would grow enough in the MES so that we could safely trade it with the same strategies that we use in the ES.

Having the MES as a stepping stone would make a much safer and lower cost learning alternative for newer traders to use to get their feet wet in a real money trading environment without having to risk large amounts of their hard earned trading capital while learning. Just to clarify, I am not suggesting you start off trading even the MES live until you have proven you can double or triple a $5,000 to $10,000 ES simulation account first. Always prove your abilities on the simulator before going live.

Our strategy and recommendation has always been one that you must prove you can do it on a good simulator trading live data first, and you need to do this for some extended period of time. Never trade with real money until you can have success on a simulator proving out your strategy and your abilities. You should you never risk a single thin dime of real trading capital before proving yourself. Our motto is you should never be a “donator” to the markets!

Even after proving it on the simulator, there is still the shock and awe of going live with real money. Once you put your hard earned cash on the line, suddenly your head starts spinning and you begin making rookie mistakes all over again. This is natural as emotions start to bubble up when our real money is on the line. So, having the Micro ES as a cheaper alternative to ease into real money day trading is interesting and exciting, but the issue has always been volume, so I have mostly ignored the micros until lately.

With all of the recent volatility, it appears that the volume has really taken off in the MES. Many have told me they are trading it live with no issues on slippage, although I have not actually traded it live myself yet. I plan to start taking some live test trades to see for myself first hand how this market trades. My first goal was to find the right tick chart, and that is the real purpose of this post today. To show you a comparison of the charts.

I am going to put up two charts from early morning, one a 2000 tick ES chart and the other a 950 tick MES chart, both being the June 2020 contract. Both charts are tracking very similar. The charting is slightly different so far, but that could be due to most of the price action so far is in the overnight session. I will compare them again later in the day and see how it turns out and maybe post an update, but so far, the MES looks very similar and very tradable as long as there is not issue with slippage.

Take a look at the two charts and see if you agree that they are certainly close enough that you could trade either one equally as well. I am using a 2000 tick chart for the ES and a 950 tick chart for the MES and they are both tracking along very nicely.

In conclusion, I want to trade the MES 950 tick chart for a bit to get a good feel for the slippage and fills on trades, but the feedback from some of those already trading it has been good. Most are reporting that there is no real slippage problem. As the volatility in the markets returns to normal, things may change, but for now, I think you can trade the MES using the 950 tick chart just as easily as you can the ES 2000 tick chart. Just in case people are reading this at a much later date in time and are curious about my “volatility” comments, understand I am writing this article during the CV-19 outbreak when the markets have been experiencing some of the highest volatility in my trading lifetime.

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