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Old 03-16-2010, 05:41 PM   #1

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Oil Trading

It has come to my realization many times that I learn things better when I force my mind to put thoughts into the written word. I have thought about starting an oil thread for quite a while but never did. So here were go.

My hope is that this will be a good place for those that trade oil to exchange thoughts and ideas about historical analysis, tomorrow’s expectations, news events,etc. Brownsfan has a great post here which goes through some of the basic facts about trading oil but I’ll do a quick version to help the thread stand on its own.




Light Sweet Crude Oil Futures Info

NYMEX Contract symbol: CL
Open ECry margin requirement: ~$2,700
Pit open: 9:00 am EST
Pit Close: 2:30 pm EST
Tick Value: The trades in increments of $0.01 which represents $10 per tick per contract traded. Nice and easy.

Monthly Contract rollover:
The CL contract rolls each month. I keep a quotes screen up that has the current month and the next 2 months in advance with the total volume info listed so that when the next month’s contract starts trading with higher volume than the current month, I rollover. Here is the month lettering for rollover:



Weekly Inventory (EIA Petroleum Status Report):
Each week The Energy Information Administration (EIA) provides weekly information on petroleum inventories in the U.S., whether produced here or abroad. It normally comes out every Wednesday at 10:30 EST but there are several times during the year when it is moved to another day due to holidays and such. Do not hold trades through this or execute trades into this report until you have experience. Historically, price volatility is more narrow from pit open to the time of this report so I make my profit targets very small if I am going to trade at all on Wednesday morning.
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Here is a historical look at the CL over the past years.



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Historical S/R provides surprisingly consistent reactions from price. Here are the major levels I keep on my chart.



The main purpose of this thread is to help those trading oil make more money trading oil through useful exchange of ideas and information. This is not my personal trading log.
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Old 03-16-2010, 06:37 PM   #2

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Re: Oil Trading

Thoughts on tomorrow.
We were at this same level on Wednesday last week when oil came out and we got a huge up and down move. The pink area noted below can be pretty choppy especially on a Wednesday before inventory so I might sit out the trades until inventory comes out. We'll see how the price action looks.

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Old 03-16-2010, 06:55 PM   #3

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Re: Oil Trading

Today, nice textbook pattern in CL



Sure, in hindsight

slds
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Old 03-16-2010, 07:44 PM   #4

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Re: Oil Trading

Here's my little contribution...





For all the oil traders out there!

Good luck w/ the thread DT, I hope you can generate some interest.
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Old 03-17-2010, 12:40 AM   #5

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Re: Oil Trading

Cool thread. Since I'm taking my CL trades live now I thought I'd chime in.

Here my longer term chart. I was looking for longs down at 79.40ish. I got a stop order in but it never filled. The level bent too much for me and I didn't catch the move up.

I'm now hoping for a pullback to 80.76ish, or a short near 83.04 OR an upside breakout about 83.04.


Click for full size - Uploaded with plasq's Skitch
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Old 03-17-2010, 09:50 AM   #6

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Re: Oil Trading

3-17-10
The K contract is getting a lot of volume. Almost time to rollover. I'm glad price gapped up out of that chop area to start the morning. I'm more inclined to try a few trades before inventory.
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Old 03-17-2010, 08:46 PM   #7

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Re: Oil Trading

All I am going to say is trading CL requires the utmost discipline.
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Old 03-18-2010, 03:35 AM   #8

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Re: Oil Trading

Quote:
Originally Posted by jonbig04 »
I'm now hoping for a pullback to 80.76ish, or a short near 83.04 OR an upside breakout about 83.04.

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And yet, to the tick


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