SCALPERS - why aren't you trading e-minis?

Don,
I have used the minis as a leading indicator for trading Naz stocks for sometime. While I find this a pretty reliable indicator, with the amount of trading I do, I often find that what appears to be a good move in the futures will often times give me a false signal for a trade and I'll get slapped around. Remember I am trading very short time frames. I listen to realtimefutures.com broadcast from the CME.

It seems to me that sometimes if I had made a quick trade on the minis, which i am listening to the call on, I would have had a decent scalp, while sometimes I'll get a momentary false signal for my equities trade. Equities will not always react as anticipated to futures move. My day is basically a game of trying to guess whether or not a move in the futures (regardless of size) will be reflected in the stock I am trading.

Wouldn't I just be better off trading the futures and trying identify technical pattern as they take shape and trying to be quick on the draw when it seems like there is action in the pits?
 
Originally posted by MACD_addy
How many contracts do you usually trade at a time?
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Options Speculative - 20 to 50
Options Spreads or Covered Calls/Puts - 1 to 20
Futures Speculative - 10
Futures Spreads - 10 to 100
Stocks - 100 to 10,000
 
Originally posted by Don Bright


The main reason we don't trade emini's is that they are the leading indicator, and the stocks follow...which makes stocks much easier to trade. (...) I trade emini's once in a while, during obvious big moves, but they are pretty tough to trade on a regular basis. (...)
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To quote CNBC's chief economist, "That's exactly right."

I would say, when scalping stocks and eminis, the two biggest misconceptions you could have about the eminis would be 1. to think the eminis don't lead the stocks and 2. to think the stocks will always follow the eminis' lead.
 
i am just wondering what are the scalpers thoughts on the new mini on he dow coming out this week on the cbot. you guys plan on scalping that or would you rather the es and nq thanks
 
I thought that the Naz, S&P and the Dow were mathamatical computations of some sort, of the movement of the stocks involved in each of the indexes?

If this is the case how can they lead the movement of a stock? If this is not the case please correct me.

I do trade the NQ, but I don't really care which way it goes, so a leading indicator is not important to me.
 
Yes, trading futures is different. But when a trend kicks in you often get a nice run. And on days without extended trends you can still get nice swings.

Futures may not have their `designated leading indicator' (or they may :cool: ). Trend continuation is more reliable as are technical indicators than with stocks.

And leverage is such a wonderful thing. The ability to make a great living on a tiny account.
 
Originally posted by cartm
i am just wondering what are the scalpers thoughts on the new mini on he dow coming out this week on the cbot. you guys plan on scalping that or would you rather the es and nq thanks
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Is that the one with the higher multiplier?
 
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