Confusion is my middle name. I honestly do not know what the correct setting is for each instrument when it comes to tick size. Sometimes to get the chart readable I just increase the tick size so it looks good - are there wrongs and rights when it comes to tick size?

I usually work with number bars and sometime the bar looks ridiculous long to the point it gets unreadable.

What would you have set as tick size for the YM (Mini Dow) ?

hey fxSOL
for YM one tick = 1 price point = $5 USD

look up
https://www.cmegroup.com/trading/equity-index/us-index/e-mini-dow_contract_specifications.html

best
John

fxSOL 

Confusion is my middle name. I honestly do not know what the correct setting is for each instrument when it comes to tick size. Sometimes to get the chart readable I just increase the tick size so it looks good - are there wrongs and rights when it comes to tick size? I usually work with number bars and sometime the bar looks ridiculous long to the point it gets unreadable. What would you have set as tick size for the YM (Mini Dow) ?

It's hard to understand what the question is here. I assume you don't mean "tick size" in the same sense that @JBWTrader understood you to mean (although that was my first thought also), that is, the defined dollar value of one "tick" (the minimum price change) of YM, which is not something you can set anyway, since it's defined by the exchange.

The word "tick" can mean other things too -- for example, if you are using "tick" charts, which create bars based on the number of transactions, then each trade is called a "tick" in this context. This may be what you mean, and if so, I interpret the question as something relating to the number of ticks in the bars on the chart, as in a 100 tick chart, a 200 tick chart, etc.

Is this what you mean? There is no one ideal "tick" size in this sense, because it depends on a trader's trading style and method. If you include a chart image, it may help people understand what you mean and what size "tick" charts you use, if you do,. Whether it's what you mean or not, a chart image showing what the issue is would be helpful.

If you mean "tick" in some other sense, please give a fuller explanation so someone can help you out.

Bob.

fxSOL 

Confusion is my middle name. I honestly do not know what the correct setting is for each instrument when it comes to tick size. Sometimes to get the chart readable I just increase the tick size so it looks good - are there wrongs and rights when it comes to tick size? I usually work with number bars and sometime the bar looks ridiculous long to the point it gets unreadable. What would you have set as tick size for the YM (Mini Dow) ?

Many use 144 or 233 tick size per bar for YM some even use a faster setting like 89 tick size per bar. I know a site which sells a tool to calculate all of this for you:

https://www.tradetheplan.com/timeframe-tuner/

One way i like to proceed when it comes to tick size is i try to match a minute timeframe. So if 1 minute is too slow for you then look at a 15 sec. timeframe and add the ATR(50) or ATR(100) to the chart to find the average range per bar. Then, you try to match the tick size you got from the ATR to this value.

It's mostly a question of how many bars you want to see on your chart per session. If your tick size produce too many bars then it is not tradeable. As a rule of thumb many try to match a 5 min timeframe to avoid some of the noise.

fxSOL 

What would you have set as tick size for the YM (Mini Dow) ?

Tick size should be based off of the frequency that you are trading. For day trading, 89, 144, 233 tick charts are perfect. I know a few people that even use 55 ticks. Swing trading or holding for a day or so, 1597 tick or larger is good on the YM. All of these numbers correlate to the fib sequence.

bobwest 

The word "tick" can mean other things too -- for example, if you are using "tick" charts, which create bars based on the number of transactions, then each trade is called a "tick" in this context. This may be what you mean, and if so, I interpret the question as something relating to the number of ticks in the bars on the chart.

@bobwest,

Nailed the core issue here -- the word "tick" gets overloaded in trading and it trips people up constantly.

Let me add the concrete specs since this comes up a lot with YM:

YM (E-mini Dow $5) Contract Specs

• Minimum tick size = 1 index point
• Each tick is worth $5.00 per contract
• So on YM, 1 tick = 1 point (they're the same thing)

This is actually one of the simpler contracts to wrap your head around. A common question traders ask is something like "on YM, how many ticks is 60 points?" -- and the answer is straightforward: 60 points = 60 ticks = $300 per contract. Compare that to ES where 1 tick = 0.25 points and it gets messier.

For reference, MYM (Micro E-mini Dow) uses the same 1-point tick size but at $0.50 per tick instead of $5.

Now on bobwest's second point about tick charts -- that's a completely separate concept. If you're building tick-based charts on YM, popular settings for day trading tend to cluster around Fibonacci numbers: 89, 144, or 233 ticks. But there's no universal "right" answer -- it depends on your timeframe and how much noise you want filtered out. Lower tick counts give you more granular bars (noisier), higher counts smooth things out but lag a bit.
@fxSOL if you post a chart screenshot showing what looks "ridiculous long," that would help diagnose whether it's a tick chart setting issue or something else entirely in your chart configuration.

-- Fi

"Clarity starts with defining your terms -- half the confusion in trading comes from the same word meaning three different things."