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The CL Crude-analysis Thread
Started:December 17th, 2014 (02:33 PM) by tturner86 Views / Replies:125,131 / 1,753
Last Reply:49 Minutes Ago (02:57 PM) Attachments:450

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The CL Crude-analysis Thread

Old March 3rd, 2015, 03:32 AM   #531 (permalink)
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mfbreakout View Post
Following is a good examle as to what i am trying to trade. A trader has limited opportunities to define upper and lower end of a move. This is especially tricky for CL. Identifying extremes within one risk profile is the HOLY GRAIL.

NOTE: When John made this video he was around 14 years old. Now he is in college and has started some very cool investment initiatives.


thats some 14 year old . im attempting similiar but get nervous holding open profit which is what im trying to condition against closing early.

nice link

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Old March 3rd, 2015, 08:42 AM   #532 (permalink)
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leinster View Post
thats some 14 year old . im attempting similiar but get nervous holding open profit which is what im trying to condition against closing early.

nice link

I try to think in following terms. May be it will help you.

1) Holding for 2, 4 hours is not easy. But that's where biggest opportunities are. Majority of the time for price to travel from one end to the other with big fat bulge in between takes couple of hours at minimum.

2) Afetr i determine where within bell curve i am- it gives me an idea of a hold time.

3) For example, i took long 49.53 into the close yesterday. When i took long , following things went hrough my mind

a) Price had moved from 51 to 49.50. That's a 150 ticks move. I like that.

b) What's the probability of CL going to 49.20, 49 etc. There is no law or set up ( at least in my mind) that CL can not go there. We are trying to pick edges of a bell curve. Who is to say 49.50 is the edge of the bell curve and not 49? This is where a combination of experience, confidence etc comes into play.

c) Since i had no way of knowingif CL will move down to 49 etc, i used appropriate position size.

d) I had Asian session in front of me. Typically CL will be stuck in 40-60 ticks range. If i am comfortable with that, i should put my stop loss and forget about CL till start of Euro session. I got out of my longs around 49.92 during Asain session.

e) Around 6.30 am eastern time this morning, i took along around 50.30 after observing Euro session price action. The trade has not turned out to be what i thought it will be but that's the price one has to pay to really learn tendencies of price during different time periods etc.

f) Before i take a trade i have pretty good idea as to how long it will take to get paid 100 etc. ticks. What kind of pullbacks i will have to endure in between. Where would i scale ourt, where would i add to a position on pullbacks etc.. What tends to happen on Monday, tuesday etc. during different time periods.

g) Bottom line keep trading LIVE and then take paper trades simulatenously and hold them per your plan. I started out with 10 ticks ( disaster trading period of 1 year), then to 30 ticks ( less disaster but still not good), then to 50 ticks etc. practising all this via live and paper trading simultaneously.

NOTE: This is for traders who just wonder what CL will do without having a trade on. Analysis/ thinking/wondering etc ONLY helps a trader once a trader has a trade on. It does not matter if it's live or paper. One needs to have a trade on to get confidence in ones analysis, set ups etc..



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.

Last edited by mfbreakout; March 3rd, 2015 at 09:21 AM.
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Old March 3rd, 2015, 09:11 AM   #533 (permalink)
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mfbreakout View Post

How about this one. He has been ruling trading world since very young age. I wonder what would he say about my charts (lol)?

Interesting. He started out with a pretty impressive choice of father, too:

S. R. Srinivasa Varadhan - Wikipedia, the free encyclopedia


Last edited by futuretrader; March 3rd, 2015 at 09:17 AM.
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Old March 3rd, 2015, 09:25 AM   #534 (permalink)
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mfbreakout View Post
y.

NOTE: This is for traders who just wonder what CL will do without having a trade on. Analysis/ thinking/wondering etc ONLY helps a trader once a trader has a trade on. It does not matter if it's live or paper. One needs to have a trade on to get confidence in ones analysis, set ups etc..

Excellent point

-Bill

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Old March 3rd, 2015, 09:28 AM   #535 (permalink)
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First trade turned out to be a scratch. Now 5 more opportunities left for me. If 50.50 area does not get taken out with conviction during NY session , i am geting mentally prepared for a mind numbing range of 49.40 to 50.50.

Per Jim Dalton, a trader needs to have couple of scenarios for every day. The other 2 scenarios depends upon as to what happens around 49.40 and 50.50.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.
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Old March 3rd, 2015, 11:03 AM   #536 (permalink)
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mfbreakout View Post
First trade turned out to be a scratch. Now 5 more opportunities left for me. If 50.50 area does not get taken out with conviction during NY session , i am geting mentally prepared for a mind numbing range of 49.40 to 50.50.

Per Jim Dalton, a trader needs to have couple of scenarios for every day. The other 2 scenarios depends upon as to what happens around 49.40 and 50.50.

short 50.10 and cover 49.55. Sitting on hands. One needs to have some context firt and then see if indicators etc giving hints of context palying out. Just following indicators is not the way to trade. 2 trades done and 4 to go- last one will be after API report after 4.30 pm. If one take a look at CL ATR on Tuesdays for couple of months, a year, one can get some sense of what happens on majority of Tuesday's. Exclude days when there was major macro news/event on Tuesday's.



My posts are not meant to give financial advice neither do they imply that my method is special. "THIS IS WHAT I COULD BE IF I HAD A TOTALLY CARE FREE STATE OF MIND DURING TRADING" Mark Douglas.

Last edited by mfbreakout; March 3rd, 2015 at 11:15 AM.
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Old March 3rd, 2015, 01:54 PM   #537 (permalink)
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30 Minute S/R Zones

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Be Patient and Trade Smart
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Old March 3rd, 2015, 02:47 PM   #538 (permalink)
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e4williams View Post
Well, how about the leverage that is offered by the ETF's.

What are your thoughts on that?

I think a 3x ETF such as ERY is just playing with straight gunpowder. If you are taking on risk, your thoughts about the leverage offered by the 2X's ETF, such as SCO versus trading the straight contract?

Why are you trading a straight contract versus the leverage that is offered by a 2X's ETF.

I think that this may be more applicable to swing position trading than intraday. Intraday, I can see that the volatility and risk are too high.

But if you are swing trading, any thoughts out there from the board as to whether to trade the straight contact or to use the leverage of a 2X's ETF as long as you put your stops in well?

Just trying to develop a trading strategy for myself. Would appreciate any opinions..

Going to a larger chart, how is crude oil going to respond to the 50 SMA on the daily chart? That's exactly, where crude oil is.

I think even trading intraday, take a look at that 50 SMA, that's where we are at. Is it going to buck or bolt it?

Leveraged ETF's are not recommended for holding a position longer than one day due to the negative effect of price decay. See this explanation... Leveraged ETF Price Decay Explained Right Side of the Chart

In designing your trading plan, you need to find the best balance of your trade hold time (time in trade) offset by your risk profile (how much risk your account can handle). If your average hold time is a day or two a leveraged ETF might work for you. If your hold time is weeks or months, the time decay of a leveraged ETF will strip away all of your profit.

One thing you can look at is the ATR of your holding period. So for example if your average hold time is 3 days, then look at the 5 day ATR, your stop might average 1.5 X the 5 day ATR. From that you can then do the math to find the position size associated with that average stop loss risk. Here's how the math works out for this example:

For the CL: The 5 day ATR of CL is currently 2.35 , 1.5 x 2.35 = 3.5 , 350 ticks * $10/tick = $3500 per contract of risk
For the USO ETF: The 5 day ATR = 0.76 , 1.5 x 0.76 = 1.14 , $1.14 * 100 shares = $ 114 of risk per 100 shares
Risking 1.5 X ATR(5) on the trade, to equal the risk of one CL contract you would need 3000 shares of USO

Be Patient and Trade Smart
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Old March 3rd, 2015, 03:04 PM   #539 (permalink)
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Interesting article on fundamentals

Hope this helps someone, I found it interesting.

US running out of room to store oil; price collapse next?

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Old March 3rd, 2015, 03:18 PM   #540 (permalink)
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I wish that there were more swing traders out there. These day trading posts are very confusing to me.

Let's say an investor had 500.000 dollars to play with. And this is not me but let's just say an investor has 500,000 to play with.

Why would a person as such fool around with day-trading.

I think that such a person would be more interested in major trend changes.

Making serious money, rather than playing around. T. Boone Pickens - How I made my first billion. George Soros, the euro dollar trade, I think it was.

All this day trading seems like crap to me, why don't people look at the larger picture on the charts.

If you are trading a 10 grand account to avoid working at McDonald's, I could see that

But as to the day traders. I think you are throwing up crap up in the air and playing with it.


Last edited by e4williams; March 3rd, 2015 at 03:47 PM.
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