Short answer: the best indicator for ES futures is session VWAP. It is built from the session's own traded volume and shows the average price paid, so one line gives you intraday bias, fair value and a profit target. The best indicator for NQ futures is the same VWAP paired with ATR(14): NQ is worth $20 per point and usually covers more points per session than ES, so stops have to be sized to volatility rather than fixed.
Add one trend filter (the 9/21 EMA intraday, or the 50/200-day moving averages for swings) and one momentum oscillator (RSI(14) or MACD(12, 26, 9)), then stop. Stacking indicators that measure the same thing adds noise, not confirmation. The table below shows each job on ES and NQ, and the strategy comparison table matches all 10 strategies to the market regime they need.
| Job | Indicator (default) | How to read it | ES vs NQ |
|---|---|---|---|
| Bias and fair value | Session VWAP with ±1 and ±2 standard deviation bands | Holding above VWAP favours longs, below favours shorts; the 2 SD band marks a stretched price | Same reading on both. NQ's point moves are larger, so judge extremes by the bands, not a fixed point distance |
| Trend | 9/21 EMA intraday; 50/200 SMA for swings | Trade in the direction of the 21 EMA's slope; the 50 above the 200 marks a long-term uptrend | Same settings on both |
| Momentum | RSI(14) with 70/30 levels, or MACD(12, 26, 9) | A cross back out of 70 or 30, or a MACD signal-line cross, times the entry. Use one oscillator, not both | Same settings on both |
| Stop size | ATR(14) | Set the stop a multiple of ATR beyond entry or structure, so it widens and narrows with volatility | The biggest difference: ES is $50 a point ($12.50 per 0.25 tick), NQ is $20 a point ($5.00 per tick) and usually moves more points |
| Key levels | Volume profile: POC, VAH and VAL (70% value area) | Value area edges are reaction zones; the point of control is where the session traded most | Same on both |
Rule of thumb: keep it to three or four indicators, with one per job. Two oscillators showing the same thing aren't confirmation. They're the same signal counted twice.
10 Futures Trading Strategies Compared
Every strategy needs a particular kind of market and fails in a predictable way. Decide what kind of session you are in first, then pick the setup that fits it. Strategies 1 to 5 are written out with entry, stop and exit rules below; 6 to 10 each have their own deep-dive guide.
| Strategy | Market regime | Timeframe | Entry trigger | Main failure mode | Deep dive |
|---|---|---|---|---|---|
| 1. Trend following (9/21 EMA, 20-day SMA) | Trending | Daily for swings; 5–15 min intraday | 9 EMA crosses the 21 EMA with price above the 20-day SMA | Whipsaws in a range | Moving average crossover and pullback rules |
| 2. Momentum (RSI + MACD) | Trending or turning | 15 min–1 hour | RSI(14) crosses back above 30 (or below 70) with a MACD signal-line cross | RSI stays pinned at an extreme through a strong trend | MACD crossover, zero-line and histogram setups |
| 3. Mean reversion (Bollinger Bands) | Ranging, ADX(14) under 25 | 5 min–1 hour | Band tag with RSI beyond 30 or 70 and a divergence | Price walks the band once a trend starts | RSI divergence confirmation rules |
| 4. Opening range breakout | Trend day from the 9:30 a.m. ET cash open | 5 min | 5-minute close beyond the 9:30–10:00 a.m. ET range on rising volume | Price breaks out, then closes back inside the range | Full rules below |
| 5. VWAP reversion | Rotational day that keeps crossing VWAP | 1–5 min | 2 standard deviations from VWAP, a reversal candle and fading volume | Trend day that holds beyond the first band | VWAP bounce, reclaim and fade setups |
| 6. Fibonacci pullback | Trend with orderly pullbacks | 5 min–daily | Reversal candle at the 38.2–61.8% retracement of the last swing | The pullback keeps going through 78.6% and the trend breaks | Fibonacci retracement levels and extension targets |
| 7. Support and resistance retest | Any, best after a clean break | 5 min–daily | A broken prior-day or overnight high or low is retested and holds (role reversal) | The level gives way on rising volume | Support and resistance zones on ES and NQ |
| 8. Candlestick reversal at a level | Any, at a level marked in advance | 5 min–daily | An engulfing, hammer or star pattern that closes at the level | The pattern forms mid-range, where it carries little information | Candlestick patterns and how to confirm them |
| 9. Volume profile (POC, VAH, VAL) | Balanced, or breaking out of value | Session or multi-day profile | Rejection at VAH or VAL back toward the POC, or acceptance outside value | Fading every value-area edge on a trend day | VAH, VAL and POC setups |
| 10. Order flow (delta, footprint) | Any, at a key level | Tick to 1 min | Absorption, stacked imbalances or delta divergence at the level | Traded without footprint data or fast execution | Order flow trading: DOM, delta and setups |
5 Futures Trading Strategies for ES and NQ
1. Trend Following
Trend following rides a move that's already established. It has the strongest research record of the five, but on a much longer horizon: Moskowitz, Ooi and Pedersen (2012) found that an instrument's past 12-month return predicted its future returns across 58 futures and forward contracts. That's a monthly effect, so treat the intraday versions as rules to test, not a proven edge.
Rules:
- Long: price closes above the 20-day SMA, the 9 EMA crosses above the 21 EMA, and volume is above its 20-day average
- Short: the mirror image: close below the 20-day SMA, 9 EMA crosses below 21 EMA, volume above average
- Stop: 2× ATR(14) from entry
- Exit: a close on the other side of the 20-day SMA
Best for: ES swing trades on daily charts. It gets chopped up in ranges, so confirm the direction on the weekly chart first. Our moving average strategies guide covers the crossover and pullback variations.
2. Momentum (RSI + MACD)
This strategy waits for an oscillator to leave an extreme and uses a MACD crossover to time the entry. It suits NQ on 15-minute to 1-hour charts.
Rules:
- Long: RSI(14) crosses back above 30 and the MACD line crosses above its signal line
- Short: RSI(14) crosses back below 70 and the MACD line crosses below its signal line
- Stop: beyond the most recent swing high or low
- Target: at least 2R (twice the distance to your stop)
Warning: momentum oscillators can stay overbought or oversold throughout a strong trend. Never fade a trend on RSI alone. For a stricter version of this setup, see the RSI divergence strategy.
3. Mean Reversion (Bollinger Bands)
Mean reversion fades stretched moves back toward an average. It only works when the market is ranging, which is why the ADX filter matters more than the entry.
Rules:
- Long: price tags the lower Bollinger Band (20, 2), RSI is below 30, and price makes a bullish divergence
- Short: price tags the upper band, RSI is above 70, and price makes a bearish divergence
- Stop: 1 ATR beyond the band
- Target: the middle band (the 20-period SMA)
Filter: skip this setup when ADX(14) is above 25, which is Wilder's threshold for a strong trend. In trends, price "walks" the band instead of reverting.
4. Opening Range Breakout
ES and NQ trade nearly around the clock on CME Globex, from 6:00 p.m. ET Sunday to 5:00 p.m. ET Friday with a daily one-hour break. "The open" here means the 9:30 a.m. ET U.S. cash open, which usually brings a burst of volume and range.
Rules:
- Range: mark the high and low from 9:30 to 10:00 a.m. ET
- Long: a 5-minute close at least 2 points above the range high on rising volume
- Short: a 5-minute close at least 2 points below the range low on rising volume
- Stop: the opposite side of the range (or its midpoint if the range is unusually wide)
- Target: the range height projected from the breakout point
5. VWAP Reversion
VWAP is cumulative (typical price × volume) divided by cumulative volume. It resets each session and began as an institutional execution benchmark. When price stretches far from it and the push loses volume, VWAP becomes the logical target.
Rules:
- Long: price is 2 standard deviations below VWAP, prints a bullish reversal candle, and the volume on the push is falling
- Short: price is 2 standard deviations above VWAP, prints a bearish reversal candle, and the volume on the push is falling
- Stop: beyond the reversal candle's extreme
- Target: VWAP itself
Skip it on trend days, when price holds beyond the first band all morning. The full playbook, including bounce and breakout setups, is in our VWAP trading strategy guide.
The 6 Best Indicators for ES and NQ Futures
1. Moving Averages (EMA and SMA)
Job: trend. Common settings: 9 and 21 EMA intraday; 50 and 200 SMA for swings.
A simple moving average weights every bar equally, while an exponential moving average weights recent prices more heavily, so it turns faster. Price above a rising average means an uptrend. A 50-day SMA crossing above the 200-day is the classic "golden cross", and the reverse is a "death cross".
2. RSI (Relative Strength Index)
Job: momentum. Default: RSI(14) on a 0–100 scale, with 70 and 30 as the overbought and oversold levels (J. Welles Wilder).
- A cross back out of 70 or 30 is the entry trigger. A reading at the extreme is not.
- A cross above or below 50 confirms a momentum shift
- Divergence (price makes a higher high while RSI makes a lower high) warns that momentum is fading
3. MACD (Moving Average Convergence Divergence)
Job: trend and momentum. Default: 12, 26, 9 (Gerald Appel).
The MACD line is the 12-period EMA minus the 26-period EMA, the signal line is a 9-period EMA of the MACD line, and the histogram is MACD minus signal. Signal-line crosses time entries, zero-line crosses confirm trend, and a shrinking histogram shows momentum fading. See the MACD trading strategy for futures-specific rules.
4. VWAP (Volume Weighted Average Price)
Job: volume and fair value. Common settings: session VWAP with ±1 and ±2 standard deviation bands.
Price above VWAP means buyers have paid up on average this session, and below means sellers are in control. In trends, VWAP often acts as dynamic support or resistance. Bands 2 standard deviations away mark stretched prices.
5. Bollinger Bands
Job: volatility. Default: a 20-period SMA with bands 2 standard deviations above and below it (John Bollinger).
Bands widen as volatility rises and narrow as it falls. A tight "squeeze" often comes before a larger move but doesn't tell you its direction. In a strong uptrend, price can tag the upper band again and again, so a band touch is not a sell signal on its own.
6. ATR (Average True Range)
Job: volatility and stop size. Default: 14 periods (J. Welles Wilder).
ATR averages each bar's true range: the largest of its high-to-low range and its distance from the previous close. It measures how far the market moves, not which way, which makes it the indicator that lets one rule set work on both ES and NQ. Illustrative numbers, not live readings: if ATR(14) on a 5-minute ES chart reads 4 points, a 2× ATR stop is 8 points, or $400 on one ES contract and $40 on MES ($5 per point). If the same chart on NQ reads 20 points, the 2× ATR stop is 40 points, or $800 on NQ and $80 on MNQ ($2 per point).
Beyond the indicator menu: volume profile and order flow answer a different question from the six indicators above: where volume actually traded, and who was aggressive. A session volume profile marks the point of control (the busiest price) and a value area that holds 70% of the session's volume by default. Order flow tools go a level deeper; our guide to reading footprint charts for delta, imbalances and absorption shows how ES and NQ traders confirm a level before entering.
Common Mistakes
- Indicator overload: six indicators produce conflicting signals and hesitation
- Wrong regime: trend-following fails in ranges, and mean reversion fails in trends
- Fixed stops on every market: NQ is worth $20 per point and ES $50 per point, and their daily ranges differ, so size stops with ATR or structure
- Chasing: entering after the move has happened wrecks your risk-reward
- Over-optimising: settings tuned to fit past data rarely hold up live
Before You Trade Any of These
- Test it: log at least 100 simulated trades under fixed rules before risking money
- Confirm the higher timeframe: take lower-timeframe entries in the direction of the higher one (see multi-timeframe analysis)
- Cap risk: risk 1–2% or less of the account per trade, sized from your stop distance (see our futures risk management framework)
- Start with micros: MES and MNQ are one-tenth the size of ES and NQ (see the Micro E-mini guide)
- Journal every trade: record the setup, why you entered, why you exited, and whether you followed the rules
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LEARN OUR STRATEGYFrequently Asked Questions
What is the best indicator for ES futures?
There is no single best indicator. For intraday ES, a practical core is session VWAP for fair value, the 9 and 21 EMAs for short-term trend and RSI(14) for momentum. Swing traders usually replace VWAP with the 50- and 200-day moving averages. Use one indicator per job and confirm with price and volume.
What is the best indicator for NQ futures?
NQ uses the same toolkit as ES: VWAP, the 9/21 EMA and RSI(14) or MACD(12, 26, 9). The difference is risk per point. One E-mini Nasdaq-100 contract is worth $20 per index point, and NQ usually covers more points per session than ES, so size stops with ATR or chart structure rather than fixed points, and consider MNQ while learning.
What is the best strategy for ES futures?
There is no single best ES strategy, because each one needs a particular kind of session. On days that trend from the 9:30 a.m. ET open, the opening range breakout and pullbacks to the 21 EMA or VWAP fit best. On rotational days when price keeps crossing VWAP, VWAP reversion and fades at the value area edges fit better. Identify the session type first, then pick the setup, and risk the same small amount on every trade.
What is a good bullish setup for NQ futures?
A rules-based bullish NQ setup needs a trend, a location and a trigger. Trend: price above a rising session VWAP and 21 EMA on the 5-minute chart. Location: a pullback that holds VWAP or the 21 EMA. Trigger: a bullish reversal candle or a MACD signal-line cross up. Put the stop below the pullback low and at least 1× ATR(14) from entry, and target the prior high or 2R. Skip it when price keeps chopping back and forth across VWAP.
What are the top futures to trade with these strategies?
These strategies are written for equity index futures: the E-mini S&P 500 (ES), the E-mini Nasdaq-100 (NQ) and their Micro versions, MES and MNQ, at one-tenth the size. ES and NQ trade nearly 24 hours on CME Globex, and a 0.25-point tick is worth $12.50 on ES, $5.00 on NQ, $1.25 on MES and $0.50 on MNQ. Starting on MES or MNQ cuts the dollar cost of every stop to a tenth while you learn.
Which futures trading strategy is most profitable?
No strategy is reliably the most profitable. Trend following has the strongest research record: a 2012 Journal of Financial Economics study by Moskowitz, Ooi and Pedersen found that past 12-month returns predicted future returns across 58 futures and forward contracts. That is a monthly-horizon effect. Intraday results depend on matching the strategy to the market regime, disciplined execution and risk per trade. Most day traders lose: a study of everyone who began day trading Brazilian equity futures between 2013 and 2015 found that 97% of those who kept going for more than 300 days lost money.
How many indicators should I use for futures trading?
Three or four at most: one trend indicator (such as the 9/21 EMA or MACD), one momentum oscillator (such as RSI or Stochastic) and one volume measure (such as VWAP or volume bars). Each should answer a different question. Adding more of the same type creates conflicting signals rather than confirmation.
What RSI settings work best for ES and NQ futures?
Start with Wilder's default RSI(14) and the 70/30 levels on whatever chart you trade, typically 5-minute to 1-hour for day trading. Treat a cross back out of 70 or 30 as the trigger, not the extreme reading itself, because RSI can stay overbought or oversold throughout a strong trend.
Does VWAP work for overnight futures trading?
Yes, with care. ES and NQ trade on CME Globex from 6:00 p.m. ET Sunday to 5:00 p.m. ET Friday, with a daily one-hour break. Depending on your platform settings, session VWAP resets at the 6:00 p.m. ET Globex open or at the 9:30 a.m. ET cash open. Overnight volume is usually thinner, so an RTH VWAP anchored at 9:30 a.m. ET is the more common day-trading reference.
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ACCESS OUR PROVEN STRATEGYSources
- StockCharts ChartSchool: Relative Strength Index (RSI): Wilder's 14-period default, 70/30 levels, and oscillators staying overbought in trends.
- StockCharts ChartSchool: MACD: Gerald Appel's 12/26/9 MACD, signal and histogram formulas.
- StockCharts ChartSchool: Bollinger Bands: the 20-period, 2-standard-deviation default and band "walks" in trends.
- StockCharts ChartSchool: VWAP: the VWAP formula, the session reset and its origin as an institutional benchmark.
- StockCharts ChartSchool: Average Directional Index (ADX): Wilder's above-25 strong-trend and below-20 no-trend thresholds.
- CME Group: E-mini S&P 500 contract specs: $50 × index, the 0.25-point tick and CME Globex trading hours.
- CME Group: E-mini Nasdaq-100 contract specs: $20 × index and the 0.25-point tick.
- AQR: Time Series Momentum (Journal of Financial Economics, 2012): trend persistence across 58 futures and forward contracts.
- TradingView Help Center: Average True Range (ATR): Wilder's true range formula and the 14-period default.
- TradingView Help Center: Volume profile indicators, basic concepts: point of control, value area high and low, and the 70% default value area.
- CME Group: Micro E-mini equity index futures FAQ: the $5 MES and $2 MNQ multipliers (one-tenth of ES and NQ) and their $1.25 and $0.50 tick values.
- SSRN: Chague, De-Losso and Giovannetti, "Day Trading for a Living?" (2020): 97% of individuals who day traded Brazilian equity futures for more than 300 days lost money.