In general: Take note of how easily Sonic can close the gap between the two. 0:24 - 0:30 and 2:00 - 2:13 both show how both character can play around each other very well in neutral.
0:02: Notice how ESAM was able to successfully stop Sonic's Spin Dash approach with a Down Tilt
0:06: Sonic's aerial approaches go over a grounded Pikachu--if ESAM had used a fair at that moment, they would have likely traded. With an uair, only Sonic would have been hit.
0:10: Sonic's Spin Dash is an excellent punish tool
0:13: Sonic's Jab can still hit Pikachu even when he has the shrunken hurtbox from his bair
0:15: Seagull Joe did an excellent job of punishing ESAM's missed fair.
0:20: Sonic not snapping to the ledge when using his Spring provided an opportunity for ESAM to tack on damage to him
0:33: Edgeguarding may not always be a good option because it forfeits stage control. When Sonic only has to recover vertically, Thunder Jolt is a good option to cover that.
0:39: Like Sonic, Pikachu can punish over a wide range with Quick Attack. The advantage Sonic has in that regard though is that simply running leaves access to most of his moveset. Quick Attack is more of a commitment then.
0:43: Another example of Down Tilt being a good option.
0:44: Another example of Sonic being able to close the gap quickly.
0:51: Thunder was an interesting choice by ESAM. His goal was to prevent Seagull Joe from moving back onto the stage, or at least punish this decision. However, by also jumping, he left a sizeable gap below him for Seagull Joe to move through and punish him for that.
1:03: If Sonic charges his Spin Dash longer, he can no longer shield cancel it. Thus, he had to commit to the attack. Trying to avoid the damage from the Thunder burst, he waited before releasing the Spin Dash. However, this was too late then and a bair from ESAM stopped his attack.
1:07: Pikachu's forward smash has 17 frames of ending lag. It seems that was just barely enough at that spacing to avoid Sonic's shield grab.
1:11 - 1:14: Keeping up with Sonic's speed can be difficult.
1:19: Here, Sonic's nair was unable to beat Pikachu's uair. Sonic's other aerials likely would not have been able to beat it either, save for dair maybe, but that moves Sonic horizontally and would have been a bad decision because of the endlag anyways.
1:29: Up until this point, Seagull Joe had waited for Pikachu's recovery on the ledge. But here, he saw the predictable movement of Skull Bash and punished it.
1:37 - 1:40: Pikachu's nair is excellent at covering Sonic's recovery when he uses Spring.
1:45: Seagull Joe lost his first stock to a pivot forward smash. ESAM may have baited Seagull Joe to drop shield when he started moving away.
1:50: Seagull Joe used Sonic's Down Smash too late, and ESAM capitalized on its endlag.
1:57: Sonic still has the ability to mix up his recovery well, especially when he has access to Spring.
2:00 - 2:13: Neutral. Seagull Joe was throwing out attacks that could have hit an opponent who advancing on the ground or in the air. ESAM forced an approach from him through Thunder Jolt. Note that Seagull Joe was not in a position that he could punish the significant amount of endlag on that move.
2:15: Using Sonic's Down Smash to punish Pikachu's endlag on Thunder Jolt was not the optimal choice. A safer option would have been grab, Jab, or ftilt. Of course, none of these could kill like Down Smash, so it is understandable why he used that move. (Out of all of Sonic's Smash Attacks, Down Smash has a hitbox come out fastest, but Forward Smash has less endlag on it.)
2:16: Because of the endlag on Down Smash, ESAM was able to punish with Pikachu's fair.
2:20: ESAM read Seagull Joe's retreat to the platform and was able to cover it with uair.
2:22: ESAM assumed that Seagull Joe would attempt to punish him on the platform, so he fell through it.
2:24: Expecing another fair from ESAM, Seagull Joe shielded, but ESAM instead went to the platform.
2:25 - 2:26: ESAM retreated to avoid Sonic's bairs.
2:27 - 2:30: He went for the fair again this time. Seagull Joe was unable to punish the move in time and ESAM was able to grab him.
2:30 - 2:32: Back Throw to Taunt is a true combo apparently.
2:32: ESAM read Seagull Joe's bair and punished it with a Thunder Jolt. I guess the taunt worked as a bait in this situation.
2:34: Because Seagull Joe did not go for the ledge, he was punished with a forward smash.
3:20: Duck Hunt provides a place for camping. But the ducks can block the projectiles sometimes.
3:22, 3:31: ESAM read the advance and was able to punish Seagull Joe.
3:26: ESAM used the Spring to his advantage to gain height. There is a
Warp Glitch associated with the Spring, that possibly could have helped.
3:35: A dtilt that is not spaced perfectly by Pikachu is, of course, unsafe on shield.
3:38: Seagull Joe made an excellent read with his uair, catching Pikachu when he was vulnerable during the middle part of Quick Attack.
3:40: Strings not involving disjointed aerials can be interrupted by Pikachu's nair
3:41 - 3:42: Sonic's speed allows for unexpected punishes.
3:43: Pikachu was vulnerable during the endlag of this move, but it required a read to punish it. Playing it safe, Seagull Joe had rolled back.
3:44: If you noticed at 2:00, Pikachu's dair went over the Spin Charge. Here, it connected. The difference was that Pikachu closer to the ground. Remember, spacing is important.
3:48 - 3:50: Here, Seagull Joe used a Homing Attack out of Spin Dash. Beware of Sonic's mixups.
3:51 - 3:52: Pikachu was just out of reach of Sonic's Spin Charge. ESAM spaced himself well.
3:53: Dash Attack was an excellent punish for Sonic's landing in this scenario.
3:55: ESAM was able to successfully read Seagull Joe's jump.
3:58 - 4:00: Seagull Joe air-dodged too early, and was forced to recover low. The invincibility during Spring seemed to have protected him from the second Thunder Jolt though.
4:01 - 4:03: ESAM got the Up Throw and the correct DI read, but he did not run far enough and he was too slow in inputting the combo.
4:05: ESAM could have forgotten that Sonic still had a jump and could avoid the forward smash read.
4:06 - 4:08: Seagull Joe attempted to surprise ESAM by running ahead of him, but ESAM was able to roll back and shield. Expecting Seagull Joe to jump back towards the center of the stage, ESAM input a Thunder, but it was not fast enough. A different punish option like uair probably would have benefit him more.
4:09 - 4:11: Pikachu's utilt caught Sonic while he was running. ESAM appeared to go for the situational utilt to Thunder combo, but DIing away seems to prevent that from working (at least with the back hitbox--I haven't looked into it much to know when it does and does not work).
4:14 - 4:19: A Dash Dance to a fair did not faze Seagull Joe and he punished it with a grab. However, he could not connect the uair. It might have been better to go for a fair in this situation.
4:23 - 4:24: A walljump to b-reversed Thunder Jolt seemed like a good idea on ESAM's part, but it put him too close to Seagull Joe, who punished it with a F6 ftilt (grab might have worked too in this scenario as a result).
4:26 - 4:28: Although he was unable to punish Pikachu's Thunder Jolts, Seagull Joe made a good decision by dropping a Spring. He also appeared to have aimed for Pikachu's extended hurtbox. Seagull Joe was often unable to do much to ESAM when he was off-stage during this set, but this shows that Sonic still has the ability to tack on damage to Pikachu.
4:34: That was a nice idea by ESAM, using the grass to conceal himself as he charged a forward smash.
4:35 - 4:37: Seagull Joe once again committed to a Spin Dash and ESAM was able to read and punish the jump with a Thunder Jolt.
4:40: Even though ESAM used it quite a bit during this match, Thunder Jolt is still a fairly punishable move.
4:42: Seagull Joe successfully read the low recovery and punished ESAM for it. It didn't get the kill, but it was still phenomenal.
4:48 - 4:49: Pikachu's ftilt and jab are both unsafe on shield, and Seagull Joe punished them well with a ftilt.
4:53 - 4:54: Seagull Joe over-committed with his Spring to uair, and ESAM punished it with an Up Smash. This was a risky move to make, and so it was highly likely that it would have been punished anyways.
5:01 - 5:06: Seagull Joe showcased Sonic's excellent ability to bait and punish here.
5:08 - 5:09: The timing for the Spring was excellent. Skull Bash was not a good choice in this scenario.
5:12 - 5:17: ESAM punished Seagull Joe's roll and was able to rack up damage. It would have been better for Seagull Joe to continue holding shield. (ESAM got the pop-up hit of Pikachu's fair at the end and so Seagull Joe was able to escape.)
5:18 - 5:21: Here, ESAM baited Seagull Joe's attack by committing to a SHAC dair. However, he was able to shield sooner than Seagull Joe had anticipated, giving ESAM an opportunity to follow Seagull Joe's path of choice and punish his landing. This again shows that Pikachu also has the ability to bait and punish as well. (Unfortunately, ESAM got the pop-up hit of fair again and couldn't follow up with the dtilt)
5:29 - 5:30: Running up and shielding can help against frequent projectile use. This helps in multiple matchups for both characters.
5:33: Seagull Joe successfully punished Thunder Jolt once again by shielding and then using ftilt. Again, that move can be very punishable depending on the gap between you and your opponent as well as how fast your opponent can close that gap and use a move.
5:35: Once again, Sonic's Spring caught ESAM.
5:40 - 5:50: ESAM had Seagull Joe off-stage and was able to rack up some damage, especially after reading Seagull Joe's low recovery. ESAM's use of d-tilt was questionable though. That move would only have worked if Sonic didn't snap to the ledge. A move that could hit the 2-frame vulnerability and cover a Spring recovery that didn't snap to the ledge would probably be Up Smash. An aerial would've been even better, but ESAM likely wouldn't have been able to do that fast enough.
5:55 - 5:56 Sonic is fast and can outrun Pikachu pretty easily.
5:56: That was a good spot-dodge read from Seagull Joe. As long as both characters can get Smash Attack punishes, killing isn't an issue at all.
6:09: ESAM was punished for the spot dodge with Sonic's Jab, but Seagull Joe jumped too early during the follow-up afterwards so he wasn't able to get more out of that read. Otherwise, that mistake would have been more costly.
6:15: A perfectly-spaced dtilt from ESAM. That was nice, so I had to point it out.
6:17: It looks like Seagull Joe tried to punish the Dash Attack with a grab but missed. The move was still in the early stages of its animation so it being a cross-up was certain.
6:20: Seagull Joe once again punished Thunder Jolt by shielding and then using ftilt. Need I emphasize how punishable this move can be, especially against Sonic?
6:22 - 6:24: ESAM went for a low recovery and Seagull Joe missed the punish, instead being punished for misreading. However, his Spring and Duck Hunt's higher platforms helped him escape further punishment.
6:32 - 6:36: This dtilt was not perfectly spaced, so Seagull Joe was able to get a grab and uair.
6:41 - 6:46: This SHAC dair also wasn't perfectly spaced, so ESAM was punished once again. Seagull Joe also was able to punish the shield drop, but he could not follow up to the angle that Pikachu was launched. ESAM then aimed fairs at where Seagull Joe was, rather than where he was going to end up. Fortunately for him, he was able to avoid a punish from Sonic.
6:50: Jab, despite being a fast option, is not safe on attack and can easily be outranged.
6:52: Seagull Joe, expecting an attack, shielded instead of going for the grab. ESAM shielded too, but then immediately rolled. As a result, Seagull Joe's grab missed and ESAM punished him with a dtilt. An attempted punish from Sonic was the most probable response to QA, so ESAM had done the most obvious response. Seagull Joe under-estimated the amount of time he had to punish ESAM.
6:55: A fair was not a good choice by ESAM. Sonic could not have gotten in a position close enough to be hit by the fair during its animation. He needed to be closer horizontally for that to have worked. Unless he moved closer, an action from the ground would have been better.
6:57: Thunder Jolt was punished again. Once more, if the opponent can easily close the gap during the duration of this move, it is not a good idea.
6:59 - 7:06: Both players were attempting to bait one another with their moves. Not much else to say about that other than to notice what they did and add that as an option when you play neutral in this matchup.
7:07 - 7:08: This Thunder Jolt was barely un-punishable. Seagull Joe was almost able to close the entire gap, but he was a little bit too far. Props to ESAM. He was able to punish Seagull Joe with his own attack then.
7:09 - 7:10: I like to refer to using Thunder Jolt and running with it as a For Glory technique, but it really can be useful. It just doesn't always work as well as expected, so be wary of that.
7:11 - 7:16: ESAM had a better chance of hitting Seagull Joe if he had run up and used Up Smash. With the right timing, it could hit Sonic during those two frames. However, it would probably be easier to punish, so it wouldn't be a good option to use all the time. Still, if he had to use a move (remember, he didn't
have to), that was his best bet. Regardless, ESAM was able to read and punish the jump with a nair and then get a dair, which was good.
7:19 - 7:21: Once again, the Spring along with Duck Hunt's platforms helped Seagull Joe escape pressure.
7:23 - 7:24: Seagull Joe got a good down throw read. But because ESAM went off-stage, he avoided the tech chase.
7:25 - 7:27: It looks like the visual effects of a forward throw aren't concealed by the grass. Why? Anyways, ESAM was able to punish it with QA though he couldn't follow it up.
7:28: Thunder Jolt was punished by Seagull Joe again. Hopefully, me bringing this up so many times hasn't gotten on your nerves.
7:33: And an Up Smash read closes the stock. Yay reads.