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Time to Short Crude Oil?
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Time to Short Crude Oil?

  #21 (permalink)
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Big Mike View Post
My swing trades are ETF's.

I believe we broke this range only temporary which is why I am interested in selling it back to the mid or low end of that range.

Sent from my LG Optimus G Pro

I'm of the opinion that it the bull is tired, but longer term we could go ether way, so if you are going to go short now, the question in my mind is where is your stop, and would you reverse at this point?

And USO has been a pretty crappy ETF. Tell FT we need Micro-CL!

(Yes I know CL is NYMEX)

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  #22 (permalink)
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Another reason to be bearish oil.

Rising China domestic oil output hurts import demand

Quoting 
(China) domestic oil production rising a fairly strong 4.3 percent over the first six months of the year from the same period in 2012.
...
If one assumed that China's domestic output had been steady in the first half of 2013, rather than increasing by 172,000 bpd, it would make the import picture quite different, and far more bullish.

Imports were 5.57 million bpd in the first six month, but without the increase in domestic output they may have reached 5.74 million bpd.

If this had been the case, first-half imports would have been 2.1 percent higher than for the corresponding period in 2012.

Put another way, the increase in domestic output has been the difference between the expected positive demand growth for imports and the actual decline recorded.

China's implied oil demand, which is calculated by adding refinery throughput to net imports of refined products, rose 3.4 percent to 9.82 million bpd in the first half.

This amounts to an increase of about 330,000 bpd, meaning that the rise in domestic output has accounted for more than half of the gain in oil demand.

But it also means China has been adding to stockpiles, as the domestic output plus crude imports exceeds the throughput by refineries.

COLUMN-Rising China domestic oil output hurts import demand: Clyde Russell | Reuters

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  #23 (permalink)
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The uptrend is now being challenged. However, the stairs are still pointing up.


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  #24 (permalink)
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bob7123 View Post
I'm of the opinion that it the bull is tired, but longer term we could go ether way, so if you are going to go short now, the question in my mind is where is your stop, and would you reverse at this point?

And USO has been a pretty crappy ETF. Tell FT we need Micro-CL!

(Yes I know CL is NYMEX)

There is already QM.

Mike

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  #25 (permalink)
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Big Mike View Post
There is already QM.

Mike

Yeah, but it's only half size. And especially on longer dated contracts has huge spread compared to CL.

If you use USO, (putting aside performance issues) you need 15K shares to get the same % movement as a QM contract, 30K shares for CL. You'd be looking at hefty margin requirements, unless there's something I don't know about.

Not that contracts are the magic bullet. CL front month is at 107, but CLF4 (Jan '14, 148 days left) is trading around 101. If you want to establish a 6 month short position, I think a good chunk of the air is out of that tire already.

I guess that's why USO's price has become so unglued from CL. They had to eat the backwardation when they roll each quarter.

It seems to me that CL is a Chevy big block of a contract on a short term basis, but regardless of size it gets a lot more complicated longer term. It is dawning on me that commodities aren't equities, or even index futures.

Anyway, I'm still waiting for the go cart!

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  #26 (permalink)
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trading crude

I posted a while ago about starting a room via scype chat mostly text at this time but we occasionally chat for those who trade energies. I am putting it out there again for anyone who is interested to please come join in. PM me for my scype details and see if you want to hang out and collaborate.

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  #27 (permalink)
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Consider this option...

Please see attached screen shots for a VERY probable scenario in the oil market...


-Chris

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Time to Short Crude Oil?-1.png   Time to Short Crude Oil?-2.png  
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  #28 (permalink)
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Hit Confluence Zone and bottom of Downtrend Channel

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  #29 (permalink)
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How will price react to crude report?

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If the bottom is in, then price could shoot straight up after this report, regardless of the info in the report.

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  #30 (permalink)
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Usually the initial reaction is the wrong one


It's one thing to get the analysis right, but how you trade it is another story...

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First live trade just before news...
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Second Live trade just after announcement...Really wanted to hold and hold, but plan says to exit at target with Divergence Potential on trade chart...Two nice winners
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