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My Journal for Crude Oil - CL Contracts
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My Journal for Crude Oil - CL Contracts

  #1 (permalink)
Lansdale, PA
 
 
Posts: 14 since Aug 2019
Thanks: 11 given, 32 received

My Journal for Crude Oil - CL Contracts

Hello All,

This is my first week of ever trading Futures ( Crude Oil , Specifically ) and I have a new found respect for anyone who does this for a living. There were times my nerves were shaking, due to me not being use to the leverage.

Here is my start -

Day One - Tons of Volatility and I started to scalp the market for a couple of hundred here and there. I turned my $4,000 Account into a 4,500 Account. I should of stopped, but this is my first day ever trading and I'm up 12.5 % on my account. It eventually turned out bad and I closed the day at around 3,700.

Day two, I had successful trades on Crude Oil and I wanted to "Check Out" Other Futures. Trading Other futures in which I had no background about was an eye opener as Gold moves very erratic compared to the High level of Volatility in Crude Oil.

Day Three - The market got in my head and I wasn't able to pull the trigger when my account dwindled down to 3,500.

Day Four - I managed to put on some trades in the European Session and got my account back to 3,700. I woke up for Work and traded the Day Session only to have it come back to 3,400.

Day Five - I really was a prisoner in my own head. The Crude Oil Market was just an absolute all out war and I can see why people don't recommend it as a beginner. I did make a Trade and was able to Manage 10 Ticks for $ 100. That built a level of confidence again. I bought 2 Contracts at Market, from a bounce and it just continued to sell off. I ended the week at $ 3,000.


Here is the Important Part that I learned.


1.) The best entries are the hardest entries. They seem like the last thing you want to do, but they work out. These are the areas in which you know we have moved far into the Under Value/ Demand or Over Value/Supply Areas.

2.) You can get an initial reading on your entry as you purchase. If you purchase 2 contracts, entering your trade in a a favorable area is where other traders typically get in as well. This can be a great place to sell a contract for a quick scalp as you wait for market to move in your favor. You can get a feel for the position and limit your draw down by purchasing the " Invisible " walls of volume in this market.

3.) The Crude Oil Market is unforgiving. If you miss the trade, don't click the "Market" Button. The consequences of doing that has cost me a large amount on my account.

4.) Understanding Market Profile helps me navigate this market.


5.) Having a smaller account means only taking the best set ups. The very Stretched Reversals are one that I look for and matching them up with key areas of volume.


I'm currently using Volume Profile and VWAP and my knowledge of Market Profile is limited.


All Feedback is Welcome.

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  #2 (permalink)
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  #3 (permalink)
Legendary Market Wizard
Dallas, TX
 
Trading Experience: Intermediate
Platform: NT, TS
Broker/Data: IB, Oanda
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Hi
Good luck with your new journal @Reefunit. As for feedback, I would recommend trading much smaller. Either skip CL and do micros for a while or trade OTM futures options. CL is a hard one to day trade for sure.

Take care,
K

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  #4 (permalink)
wellington new zealand
 
 
Posts: 12 since Mar 2017
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Good luck with your journal & trading.

A 25% loss in your first week should certainly get you thinking. Of course you could make 50%, 100% whatever next week & that in itself is also not necessarily a "good thing".

Are your losses the result of following a pre-defined plan & process or just "gunslinging" ? If the former, it needs work, if the latter then the market always needs fresh meat to feed on.

Were your successful trades simply "winning" trades or trades you entered/managed/exited the trade exactly as you should have?

In short I'd definitely suggest trading much smaller size & also to think of successful trading as following a process & executing well rather than a $ result. IF you can consistently identify an edge the $ will follow. If not, all the discipline & money management wont be able to save you in the long run.

The market started to get in your head on Day 3 - huge swings in p/l, uncertainty in results etc will likely make the psychological demons get worse so try & establish a baseline of what to expect.

Good luck

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  #5 (permalink)
Lansdale, PA
 
 
Posts: 14 since Aug 2019
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Learning Process


Etisan View Post
Good luck with your journal & trading.

A 25% loss in your first week should certainly get you thinking. Of course you could make 50%, 100% whatever next week & that in itself is also not necessarily a "good thing".

Are your losses the result of following a pre-defined plan & process or just "gunslinging" ? If the former, it needs work, if the latter then the market always needs fresh meat to feed on.

Were your successful trades simply "winning" trades or trades you entered/managed/exited the trade exactly as you should have?

In short I'd definitely suggest trading much smaller size & also to think of successful trading as following a process & executing well rather than a $ result. IF you can consistently identify an edge the $ will follow. If not, all the discipline & money management wont be able to save you in the long run.

The market started to get in your head on Day 3 - huge swings in p/l, uncertainty in results etc will likely make the psychological demons get worse so try & establish a baseline of what to expect.

Good luck


I really didn't know what I would expect my First week. I am thinking long and hard about that draw down, but trying to go back and highlight the key lessons learned in this week.

I'm a Discretionary Trader and my plan really consists of a Top Down Market Analysis the night before, marking down key areas of Volume ( In case we do hit those areas Intraday ) and assessing the dominant direction to match myself on the right side of the market. This is what I believe to be my Edge.

When I stuck to my Plan, I typically did well and most of my trades would trade in the direction of my Trade. I would add limit orders to those areas and remove a contract at about 10 ticks. The issue for me is the volatility in crude can really toss around a small account, but I did want to experience this first hand to get a feel for that market.

The Other times I deviated and missed a trade or just know I'm so " Right " about this trade and enter a Market Order for a buy or sell, typically ended in much larger losses than winners. I didn't have the proper discipline to stick to only entering key areas. The market made me pay a hefty price, when I was least expecting it.

I will make an attempt this week to only take the highest quality trades and to allow my trade to run. The Trades were calculated Entries with Discretionary Exits. I was a little quick to take profits, but I looked back and saw that I would of had some great trades.

I wasn't aware of what to except my first week, but it is becoming a normal baseline and that excitement/nervousness didn't creep in as much by the end of that week.


I will start to look at trading a Micro / E mini Futures in an attempt to show some form of consistency. The damage has been done and I just have to learn from it and move on.

This is a journey I have taken alone, and I'm just glad to be apart of this forum with other Traders who have gone down the same road.

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  #6 (permalink)
wellington new zealand
 
 
Posts: 12 since Mar 2017
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Reefunit View Post
I really didn't know what I would expect my First week. I am thinking long and hard about that draw down, but trying to go back and highlight the key lessons learned in this week.

I'm a Discretionary Trader and my plan really consists of a Top Down Market Analysis the night before, marking down key areas of Volume ( In case we do hit those areas Intraday ) and assessing the dominant direction to match myself on the right side of the market. This is what I believe to be my Edge.

When I stuck to my Plan, I typically did well and most of my trades would trade in the direction of my Trade. I would add limit orders to those areas and remove a contract at about 10 ticks. The issue for me is the volatility in crude can really toss around a small account, but I did want to experience this first hand to get a feel for that market.

The Other times I deviated and missed a trade or just know I'm so " Right " about this trade and enter a Market Order for a buy or sell, typically ended in much larger losses than winners. I didn't have the proper discipline to stick to only entering key areas. The market made me pay a hefty price, when I was least expecting it.

I will make an attempt this week to only take the highest quality trades and to allow my trade to run. The Trades were calculated Entries with Discretionary Exits. I was a little quick to take profits, but I looked back and saw that I would of had some great trades.

I wasn't aware of what to except my first week, but it is becoming a normal baseline and that excitement/nervousness didn't creep in as much by the end of that week.


I will start to look at trading a Micro / E mini Futures in an attempt to show some form of consistency. The damage has been done and I just have to learn from it and move on.

This is a journey I have taken alone, and I'm just glad to be apart of this forum with other Traders who have gone down the same road.

Good...Accept > Learn > Move on is key.

Only taking trades where you believe your edge exits should help consistency in execution. Not every trade will win but that doesn't make it a "bad trade". Keep the metrics of MAE, MFE, Risk;Reward on the completed trade etc to help get an idea of the value of your perceived edge & your exploitation of it.

Discretionary exit is fine if the exit is because of a change in the market dynamic. ie. there's a reason to exit rather than I just wanna take the money. I dont scale out at pre=determined $/tick points. If theres a reason to be in, stay in, if theres a reason to be out get out.

Account size is not necessarily the issue if the correct risk parameters & trading metrics are in place. On a small account you cant afford to take big hits to p/l. You'll be out of the game before youve learnt how to trade so trading small will prolong your learning process. Even a trader with a large account but the wrong metrics will eventually hit the bottom, it just takes them longer.

I also trade Crude but almost exclusively use Market Orders. If I should be in/out - I get in/out. I dont want to rely on another trader doing it for me by using Limit orders. If i'm correct in my assessment & my edge "appears" I should take very little heat on a winning trade. If not I'm out quickly for a small loss....next trade.

Just to clarify though, there is no "one way", nothing is absolute. What I say/do or how I trade will not resonate with everyone which is as it should be. You will either find your "own way & path" to successful trading or you will not. It wont be easy, there will be highs & lows & its not for everyone.

Good luck on your journey.

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  #7 (permalink)
Lansdale, PA
 
 
Posts: 14 since Aug 2019
Thanks: 11 given, 32 received

9/23/2019

Today, I posted a small loss (-97), but I made some immediate changes and took the advice of the individuals that were kind enough to provide it.

I looked over my stats and saw that I lost approx 15 % of my account to GC alone. Now was not the time to trade items that I don't understand and are bleeding out my account. I currently removed it the Items I trade.

I looked over my CL trades and I've been very impressed with my performance, as It appears I'm closing out over 74 % winners. I was seeing a " Three Digit Gain " and closing the trade. I'm now focusing my exit on a particular area and reading the price action, while looking at the DOM. I'm forcing myself to "wait" until the trade plays out and also adding 5 Ticks to where I would normally enter my trade. This has allowed me to have some amazing entries with very little draw down.

I switched over to Trading the Micros - ES NQ, GC, and I limited myself to 1 Amazing CL trade a day with a Max Risk of 2 % ( 6 Ticks) . Today, My trade started to move heavily in my direction, but moving my stop loss to ensure I walked away with something was a big mistake. It appears there was a fake out to the upside, only to continue selling back to my target.

I'm strictly risking 1 % per trade, ( Except for CL - 2 % once a day) and the market volatility is very manageable with a small account.

I decided on following all of the above, when I traded GC last night and although the trade was great, my stop was too tight and I simply was not allowing the trade room to start to move in my favor. After being stopped out twice for -$260, I decided that those changes needed to be made.

I really feel like I was Trading in Key areas, took very little heat at times and took very tiny 1 % losses when I was wrong.

My best trade was going short 5 Contracts of MES at 2994.00 , close out at 2986.00.


I'll start to mark my key volume areas, Previous VPOC with high reactions and marking the Value area for all of the ranges that I trade over the Month.


Last edited by Reefunit; September 23rd, 2019 at 11:27 PM.
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  #8 (permalink)
Lansdale, PA
 
 
Posts: 14 since Aug 2019
Thanks: 11 given, 32 received

9/24 - Futures Day Trading

Today wasn't a good day or a bad day. I finished the day with -$50 PnL. I was very stringent on maintaining my risk to 1 % and only took a CL Scalp for 4 ticks. My Account is showing 2,720 and I'm glad I took measures to stop the bleeding.

I did get cocky during the end of the day and took a Market Order I shouldn't have in Micro-Gold. I was actually +$5.00, which would have been the first day I showed a gain. (Excluding Commissions and fees).


Things I learned Today -

1.) The Market is typically in price discovery during the first hour of the day. When price finds it way to the below the VAL, It's a safer bet to buy on the first test of this area. I also notice that the Market will then continue to test the above the VAH and this could also be a safe place to put a trade on as well. These are typically lower risk trades and can provide some of the best entries , if price continues to the other side and break through. I have to make an attempt to be ready and prepared by 7:30 AM EST to trade the Markets. Typically the Value Discovery starts around 9:00 AM for CL and 9:30 AM for ES/NQ.

2.0 Use the VWAP as your price guide. If Price tests the VWAP and if price moves in your direction, stay in the trade as there could be a big move coming along. I notice that multiple tests of the VWAP indicate large buying or selling, which take time to unravel. I have to be patient and stick to my plan.

3.) Above/Below Yesterdays Value Area is a great place for a buy or sell. I've seen the other side of the Value Area contain the Low or High of the day on several occasions. The Opening Range also has a 20 % chance of containing the high or low According to Mark Fisher.

4.) Sometimes Trades don't go to plan. It's OK to scale out some position on moves of your entries. Today, I had two opportunities to buy back into my Areas. Although they were counter trend trades, I was still able to sell for a few ticks.


5.) The money is made in the big moves, but I just haven't been able to purchase in those areas, due to my mornings being tied up. If I can just execute a trade at a key area and hold it for the day, that has a realistic potential to take me back to my Break Even Point. It appears it is "absolutely mandatory" to be viewing the markets at 7:30 AM EST, If you want to enter the position that will most likely continue to run throughout the Day.

6.) Over trading is my biggest weakness. I try to trade after business hours and on Weekends and it just doesn't work. I will only trade during the European or American Business Session. I don't have a choice, but to rely on those that move the market. It's foolish to scalp for a couple of dollars. I will also stop trading, once I post a couple of good trades. I will limit myself to 5 good trades and shut off my connection afterwards.


My Mental state was very clear today. I know my mistakes, but I can see a difference in how I manage my positions. I'm willing to wait more for the outcome of the trade, instead of take quick profits.


Tomorrow, I will be prepared for a range bound day in the Markets. This is my bias, as this typically occurs after a trending day.


I hope these notes are helpful to anyone who reads them..


Advanced Traders - Feel Free to tell me if I'm on the Right Track or Wrong Track. All Feedback is welcome.

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  #9 (permalink)
wellington new zealand
 
 
Posts: 12 since Mar 2017
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Sounds like you have made some progress in being honest with what wasn't working & taking steps to address them. Well done.

I can't really comment on what, why or when you should use something (eg VWAP) - each to their own & you must find something you are comfortable with & you believe gives you an edge. There is no "best way" just like there is no "best indicator/setting" or "best timeframe" eg. If you're looking at a 10min chart & I'm looking at a 3 min chart we are both looking at the same market that moves tick by tick. It doesnt stop/start at the end of every bar we've each randomly chosen to slice the day into. If someone says "I can see support/resistance on a 10 min chart" I think "Hmmm, if that support/resistance isn't there on a 1 x tick chart, 10 sec chart, 4 min, 8min, 20min whatever chart, guess what, it aint there!

Having a set timeframe to trade may help diminish some randomness eg I only trade 9.30am - 12.00est

I also dont subscribe to the "stopping after x winners(or losers)". IF i believe there is an opportunity for my edge to appear in my timeframe of trading I want to take it - win or lose doesnt matter . Cutting that opportunity short seems a bit like a barber doing 3 haircuts before 11.00am then shutting up shop with a queue of people outside or a restaurant cancelling the evenings bookings cos they were full for lunch & have made their money for the day

I'd also say that a small edge consistently executed well will outperform a large edge executed poorly so remain aware of the mental battles you'll face throughout your career to avoid blowing a decent week by going off tilt on 1 day. I've been trading a long time but still read a "trading mindset" sheet every day pre-trading.

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  #10 (permalink)
Lansdale, PA
 
 
Posts: 14 since Aug 2019
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9/25 - Trading Journal


I got into 6 Trades Today.

Early Morning, I saw GC weaking from the 1536, So I submitted a Short on a single Contract of Micro GC , on a failure to breach VWAP. So,I widen my stop and place it over the Daily VAH, Approx 1 % of Risk to my total Account. I've done my homework in advance, so I knew where my key area for an exit was 1513 in the event of a selloff. We got a sell off today in GS and I closed that trade out for 26 Points. That is a 10 % Trade in one day on my account. These trades don't happen everyday, but this one was quite apparent with the failures at 1540 multiple times overnight.

I was able to Scalp CL for a total of $40.

I did try to Sell CL at the Key Areas and I was stopped out twice for a loss of $70. That was two strikes, so I stayed away from CL for the rest of the day.

I did have some trades on the MES, but nothing panned out. A couple of Tiny Losses.


That would bring my Account up to $2,860.00 ( Before Fees and Commissions), which should bring me to about $2,845.

Today would be the First day ever with a Net Positive Day of just about 7 % gain ( After Fees and Taxes)


Things I've learned

1.) Trust the Plan and Process. Your mind is always telling you to just sell out now and take the money. It paid off in a big way to stay in that 4 hour trade in Micro GC Today. 10 % Gain on one Micro Contract of Gold is just crazy, and I was glad to be on the right side of that trade.

2.) Crude Is a Volatile Market, and I have to allow for those Movements. I set tight stops, as I don't want to blow my account up. I'm sure some will tell me I shouldn't be trading it at all. I am understanding the movement, but I don't allow enough room on my stop. I just can't risk it.

3.) Markets trade to Value and the Center Pivot Point. If you have a Value Area, Yesterday's VPOC and Center Pivot Point Under/Over Price, you have a probability that price will make it to that general direction.

4) Markets generally revert back to value, until the value changes due to fundamentals. I believe I have better odds trading back into Value, and always being cautious of trend days. It pays to purchase the testing of the VAH & VAL. Now if I can only find a way to figure out how deep price will go in that direction, until the market is satisfied.

5.) Profitable Traders most likely wait for the bigger moves. I currently pay .78 Cents per roundtrip for Micros and 4.76 for CL/GC Contracts round trip. Trade less, Trade Earlier and let the move payout. I have to make it worth my while and enter into optimal areas. What I feel is an Optimal area, I probably need to add .10 to the price and move my Limit Order back. I would miss great trades, but I would also limit the Heat the position takes by buying into a peak of a volatile move in a key area.


Mentally- I traded ok. I'm not pleased with my performance due to the mistakes I made with CL. I feel I could of been a bit more patient before entering.

Homework - I marked up all my key areas early morning and it showed me exactly where I needed to enter and exit the markets. I can see why this is so important during the trading day.

This appears to be all about Probabilities. I'd like start to use a Risk Credits during the day to limit my trades. I'm aware of my edge, but I still need practice executing it.


One day of Profits doesn't indicate success, so I'll have to do more homework and prep for tomorrow.

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