MNQ and MES Futures Fundamentals and Price Action Vocabulary

Vocabulary flashcards covering futures fundamentals, price action, breakout and retest sequences, volume analysis, risk management, and contract specs for MNQ and MES.

Candle Body

The distance between the open and close.

Candle Wicks

Prices reached during the candle but rejected before the close.

Long Lower Wick

Sellers pushed price down, but buyers pushed it back up, indicating potential rejection of lower prices.

Long Upper Wick

Buyers pushed price up, but sellers pushed it back down, indicating potential rejection of higher prices.

Large Candle Body with Small Wicks

Indicates strong directional conviction or momentum.

Small Body or Doji

Indicates indecision or balance between buyers and sellers.

Bullish Engulfing Candle

A strong bullish body that engulfs the prior bearish body; potential shift toward buyers.

Bearish Engulfing Candle

A strong bearish body that engulfs the prior bullish body; potential shift toward sellers.

Uptrend / Bullish Structure

Market structure characterized by higher highs and higher lows.

Downtrend / Bearish Structure

Market structure characterized by lower highs and lower lows.

Higher High (HH)

A swing high above the previous swing high.

Higher Low (HL)

A swing low above the previous swing low.

Lower High (LH)

A swing high below the previous swing high.

Lower Low (LL)

A swing low below the previous swing low.

Break of Structure

Price decisively breaks an important prior swing high or low.

Support

An area where buying has previously been strong enough to stop or slow a decline.

Resistance

An area where selling has previously been strong enough to stop or slow a rise.

Breakout

Price decisively moves through an established support or resistance level.

Retest

Price returns to the broken level after the breakout.

False Breakout

Price breaks a level, fails to hold beyond it, and returns through the level.

Volume

The number of contracts traded during a period.

Basic Breakout/Retest Setup Sequence

$$\text{Level} \rightarrow \text{Breakout} \rightarrow \text{Retest} \rightarrow \text{Confirmation} \rightarrow \text{Entry}$$

Confirmation

Price action gives additional evidence that the retest is holding and price may resume in the breakout direction.

1R

The amount planned to risk on the trade.

MNQ

Micro E-mini Nasdaq-100 futures.

MNQ Point Value

$1$ MNQ point is worth $\$2$ per contract.

MNQ Minimum Tick

$0.25$ points, worth $\$0.50$ per contract.

MES

Micro E-mini S&P 500 futures.

MES Point Value

$1$ MES point is worth $\$5$ per contract.

MES Minimum Tick

$0.25$ points, worth $\$1.25$ per contract.