NQ vs ES Order Flow Which Is Better For Trading Using Orderflows Trader

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A question I get asked frequently from traders is whether it is better to day trade the ES or NQ futures contract. There are pros and cons to each that are worth considering.

In my experience, the ES tends to have higher daily trading volume and liquidity overall compared to the NQ. This makes it generally easier to efficiently enter and exit positions on the ES, while the NQ is more prone to large price gaps up or down occasionally that can lead to slipped orders. The depth of book tends to be better on the ES with more resting limit orders at each price level versus the NQ.

However, the NQ does offer some trading advantages of its own. On an index point basis, the NQ contract tends to be more volatile intraday than the ES. This leads to wider daily trading ranges and more short-term price action on a typical day. For traders who rely on volatility-based strategies, the NQ provides more movement to potentially take advantage of.

It's important to note though that the ES and NQ have a strong long-term correlation overall. They generally trend in the same direction over time. However, in the short-term of several days or weeks they can diverge and develop unique personalities. Really understanding this correlation is key to successfully trading the relationship between the two.

When it comes to leverage, the NQ provides more bang for your buck. Each contract controls a larger nominal dollar amount ($100,000 for NQ vs $50,000 for ES). So you can get greater market exposure with less margin allocation on NQ. But the ES offers more size and liquidity per tick.

Overall, my personal preference is to focus my intraday trading on the ES futures. I find it more forgiving and easier to read from an order flow perspective. But both the ES and NQ offer unique opportunities that skilled traders can take advantage of once they really master the nuances of each contract.