Showing posts with label crude oil. Show all posts
Showing posts with label crude oil. Show all posts
Monday, 23 May 2011
Delta Divergence Short Setup on Crude Oil
I noticed this nice short setup on CL today. Cumulative Delta was lower while price was higher(also it was a morning High of Day).
Delta Divergence Short Setup on Crude Oil
I noticed this nice short setup on CL today. Cumulative Delta was lower while price was higher(also it was a morning High of Day).
Saturday, 18 September 2010
Correlation Trader vs. Signal Trader
Crude Oil Correlation vs AUD/JPY & AUD/USD
Crude Oil Signals
Correlations only work until they don't. Friday, we saw Crude Oil get crushed. I made the mistake of basing my trades off the correlation of AUD/USD, AUD/JPY vs Crude Oil. This trade idea may work on a longer term basis(several Days), but I am a Day Trader, and I need to stick to what works for me, and right now, trading signals on a minute to minute basis and using stops has been working fabulously.
Crude Oil Signals
Correlations only work until they don't. Friday, we saw Crude Oil get crushed. I made the mistake of basing my trades off the correlation of AUD/USD, AUD/JPY vs Crude Oil. This trade idea may work on a longer term basis(several Days), but I am a Day Trader, and I need to stick to what works for me, and right now, trading signals on a minute to minute basis and using stops has been working fabulously.
Correlation Trader vs. Signal Trader
Crude Oil Correlation vs AUD/JPY & AUD/USD
Crude Oil Signals
Correlations only work until they don't. Friday, we saw Crude Oil get crushed. I made the mistake of basing my trades off the correlation of AUD/USD, AUD/JPY vs Crude Oil. This trade idea may work on a longer term basis(several Days), but I am a Day Trader, and I need to stick to what works for me, and right now, trading signals on a minute to minute basis and using stops has been working fabulously.
Crude Oil Signals
Correlations only work until they don't. Friday, we saw Crude Oil get crushed. I made the mistake of basing my trades off the correlation of AUD/USD, AUD/JPY vs Crude Oil. This trade idea may work on a longer term basis(several Days), but I am a Day Trader, and I need to stick to what works for me, and right now, trading signals on a minute to minute basis and using stops has been working fabulously.
Thursday, 2 September 2010
Crude Oil Intermarket Correlation vs AUD.JPY & Intraday Trend Analysis
As you can see from the charts, Crude Oil and the AUD/JPY have been highly correlated as of late. We see Crude as a buy when it is oversold relative to AUD/JPY and Crude as a sell when overbought relative to AUD/JPY.
In this chart you can see how AUD/USD put in a higher low when AUD/JPY & Crude Oil were putting in a low for the day, suggesting a bullish divergence.
A common theme intraday for Crude Oil has been a second initiation in buying/selling in the direction of VWAP around 1 to 1:30pm EST, with a close near the low/high of day.(Please note my charts are Pacific time- Add 3hrs for EST)
In this chart you can see how AUD/USD put in a higher low when AUD/JPY & Crude Oil were putting in a low for the day, suggesting a bullish divergence.
A common theme intraday for Crude Oil has been a second initiation in buying/selling in the direction of VWAP around 1 to 1:30pm EST, with a close near the low/high of day.(Please note my charts are Pacific time- Add 3hrs for EST)
Crude Oil Intermarket Correlation vs AUD.JPY & Intraday Trend Analysis
As you can see from the charts, Crude Oil and the AUD/JPY have been highly correlated as of late. We see Crude as a buy when it is oversold relative to AUD/JPY and Crude as a sell when overbought relative to AUD/JPY.
In this chart you can see how AUD/USD put in a higher low when AUD/JPY & Crude Oil were putting in a low for the day, suggesting a bullish divergence.
A common theme intraday for Crude Oil has been a second initiation in buying/selling in the direction of VWAP around 1 to 1:30pm EST, with a close near the low/high of day.(Please note my charts are Pacific time- Add 3hrs for EST)
In this chart you can see how AUD/USD put in a higher low when AUD/JPY & Crude Oil were putting in a low for the day, suggesting a bullish divergence.
A common theme intraday for Crude Oil has been a second initiation in buying/selling in the direction of VWAP around 1 to 1:30pm EST, with a close near the low/high of day.(Please note my charts are Pacific time- Add 3hrs for EST)
Sunday, 22 August 2010
AUD/JPY Carry Trade and SP500 Correlation
There is a high correlation between the SP500 and AUD/JPY and also AUD/USD.
This chart shows SPY(SP500 vs AUD/JPY)
Australia's elections over the weekend has resulted in hung parliament, which will take some time to resolve once all the votes are counted. With Issues in Australia over elections we might see AUD/JPY selling (risk aversion/unwinding carry trade) and this will help the bears bring the SP500 down. We are also seeing continued strength in the USD/JPY and Treasuries which has caused weakness in Crude Oil and Copper due to the inverse correlation relationship. (Crude Oil and Metals like copper have high correlation to AUD/USD, CAD/USD, and NZD/USD).
The bear scenario for next week-
SELLING IN-AUD/JPY, CAD/JPY SP500, Crude Oil, and Copper
BUYING IN- JPY vs all currencies, 30yr bonds, and VIX
Here are some old Intermarket Correlation resources from ForexAutomaton the period 2002-2008-
Here are some links that look at Currency Correlation of the AUD/JPY vs SP500 and the current state of 30 year treasuries-
This chart shows SPY(SP500 vs AUD/JPY)
Australia's elections over the weekend has resulted in hung parliament, which will take some time to resolve once all the votes are counted. With Issues in Australia over elections we might see AUD/JPY selling (risk aversion/unwinding carry trade) and this will help the bears bring the SP500 down. We are also seeing continued strength in the USD/JPY and Treasuries which has caused weakness in Crude Oil and Copper due to the inverse correlation relationship. (Crude Oil and Metals like copper have high correlation to AUD/USD, CAD/USD, and NZD/USD).
The bear scenario for next week-
SELLING IN-AUD/JPY, CAD/JPY SP500, Crude Oil, and Copper
BUYING IN- JPY vs all currencies, 30yr bonds, and VIX
Here are some old Intermarket Correlation resources from ForexAutomaton the period 2002-2008-
Here are some links that look at Currency Correlation of the AUD/JPY vs SP500 and the current state of 30 year treasuries-
AUD/JPY Carry Trade and SP500 Correlation
There is a high correlation between the SP500 and AUD/JPY and also AUD/USD.
This chart shows SPY(SP500 vs AUD/JPY)
Australia's elections over the weekend has resulted in hung parliament, which will take some time to resolve once all the votes are counted. With Issues in Australia over elections we might see AUD/JPY selling (risk aversion/unwinding carry trade) and this will help the bears bring the SP500 down. We are also seeing continued strength in the USD/JPY and Treasuries which has caused weakness in Crude Oil and Copper due to the inverse correlation relationship. (Crude Oil and Metals like copper have high correlation to AUD/USD, CAD/USD, and NZD/USD).
The bear scenario for next week-
SELLING IN-AUD/JPY, CAD/JPY SP500, Crude Oil, and Copper
BUYING IN- JPY vs all currencies, 30yr bonds, and VIX
Here are some old Intermarket Correlation resources from ForexAutomaton the period 2002-2008-
Here are some links that look at Currency Correlation of the AUD/JPY vs SP500 and the current state of 30 year treasuries-
This chart shows SPY(SP500 vs AUD/JPY)
Australia's elections over the weekend has resulted in hung parliament, which will take some time to resolve once all the votes are counted. With Issues in Australia over elections we might see AUD/JPY selling (risk aversion/unwinding carry trade) and this will help the bears bring the SP500 down. We are also seeing continued strength in the USD/JPY and Treasuries which has caused weakness in Crude Oil and Copper due to the inverse correlation relationship. (Crude Oil and Metals like copper have high correlation to AUD/USD, CAD/USD, and NZD/USD).
The bear scenario for next week-
SELLING IN-AUD/JPY, CAD/JPY SP500, Crude Oil, and Copper
BUYING IN- JPY vs all currencies, 30yr bonds, and VIX
Here are some old Intermarket Correlation resources from ForexAutomaton the period 2002-2008-
Here are some links that look at Currency Correlation of the AUD/JPY vs SP500 and the current state of 30 year treasuries-
Wednesday, 24 June 2009
Gas Saving Tips
I was reading an old Article from CalTrader on saving money at the gas pump.
Here are the three main tips-
1.Fill up in the morning when the outside temp is colder,(gas condenses at colder temps, so you get more bang for your buck as opposed to buying the middle of the day when its hot)
2.Fill up with the nozzle at half cock instead of fully pressed down,(less vapors escape when the filling rate is slower)
3.Fill up when your gas tank is 50% empty,(gas will evaporate faster if there is more air in the gas tank)
The facts from CalTrader-
Here are the three main tips-
1.Fill up in the morning when the outside temp is colder,(gas condenses at colder temps, so you get more bang for your buck as opposed to buying the middle of the day when its hot)
2.Fill up with the nozzle at half cock instead of fully pressed down,(less vapors escape when the filling rate is slower)
3.Fill up when your gas tank is 50% empty,(gas will evaporate faster if there is more air in the gas tank)
The facts from CalTrader-
Only buy or fill up your car or truck in the early morning when the ground temperature is still cold. Remember that all service stations have their storage tanks buried below ground. The colder the ground the more dense the gasoline, when it gets warmer gasoline expands, so buying in the afternoon or in the evening....your gallon is not exactly a gallon. In the petroleum business, the specific gravity and the temperature of the gasoline, diesel and jet fuel, ethanol and other petroleum products plays an important role.
A 1-degree rise in temperature is a big deal for this business. But the service stations do not have temperature controls.
Compensation at the pumps.
When you're filling up do not squeeze the trigger of the nozzle to a fast mode. If you look you will see that the trigger has three (3)stages: low, middle, and high. In slow mode you should be pumping on low speed, thereby minimizing the vapors that are created while you are pumping. All hoses at the pump have a vapor return. If you are pumping on the fast rate, some other liquid that goes to your tank becomes vapor. Those vapors are being sucked up and back into the underground storage tank so you're getting less worth for your money.
One of the most important tips is to fill up when your gas tank is HALF FULL or HALF EMPTY. The reason for this is, the more gas you have in your tank the less air occupying its empty space. Gasoline evaporates faster than you can imagine. Gasoline storage tanks have an internal floating roof. This roof serves as zero clearance between the gas and the atmosphere, so it minimizes the evaporation. Unlike service stations, here where I work, every truck that we load is temperature compensated so that every gallon is actually the exact amount.
Gas Saving Tips
I was reading an old Article from CalTrader on saving money at the gas pump.
Here are the three main tips-
1.Fill up in the morning when the outside temp is colder,(gas condenses at colder temps, so you get more bang for your buck as opposed to buying the middle of the day when its hot)
2.Fill up with the nozzle at half cock instead of fully pressed down,(less vapors escape when the filling rate is slower)
3.Fill up when your gas tank is 50% empty,(gas will evaporate faster if there is more air in the gas tank)
The facts from CalTrader-
Here are the three main tips-
1.Fill up in the morning when the outside temp is colder,(gas condenses at colder temps, so you get more bang for your buck as opposed to buying the middle of the day when its hot)
2.Fill up with the nozzle at half cock instead of fully pressed down,(less vapors escape when the filling rate is slower)
3.Fill up when your gas tank is 50% empty,(gas will evaporate faster if there is more air in the gas tank)
The facts from CalTrader-
Only buy or fill up your car or truck in the early morning when the ground temperature is still cold. Remember that all service stations have their storage tanks buried below ground. The colder the ground the more dense the gasoline, when it gets warmer gasoline expands, so buying in the afternoon or in the evening....your gallon is not exactly a gallon. In the petroleum business, the specific gravity and the temperature of the gasoline, diesel and jet fuel, ethanol and other petroleum products plays an important role.
A 1-degree rise in temperature is a big deal for this business. But the service stations do not have temperature controls.
Compensation at the pumps.
When you're filling up do not squeeze the trigger of the nozzle to a fast mode. If you look you will see that the trigger has three (3)stages: low, middle, and high. In slow mode you should be pumping on low speed, thereby minimizing the vapors that are created while you are pumping. All hoses at the pump have a vapor return. If you are pumping on the fast rate, some other liquid that goes to your tank becomes vapor. Those vapors are being sucked up and back into the underground storage tank so you're getting less worth for your money.
One of the most important tips is to fill up when your gas tank is HALF FULL or HALF EMPTY. The reason for this is, the more gas you have in your tank the less air occupying its empty space. Gasoline evaporates faster than you can imagine. Gasoline storage tanks have an internal floating roof. This roof serves as zero clearance between the gas and the atmosphere, so it minimizes the evaporation. Unlike service stations, here where I work, every truck that we load is temperature compensated so that every gallon is actually the exact amount.
Monday, 22 September 2008
Epic Crude Oil Short Squeeze
Largest Crude Oil Move ever comes a few days after the biggest Gold move ever, all happening STRATEGICALLY on OPEX expiry.
Epic Crude Oil Short Squeeze
Largest Crude Oil Move ever comes a few days after the biggest Gold move ever, all happening STRATEGICALLY on OPEX expiry.
Thursday, 21 August 2008
Commodity Bounce
Well it was bound to happen. The question is, whether the bounce in commodities will have legs and keep crawling up to new highs for Gold and Crude Oil, or if this pop is simply a bounce in a down trending market. With tensions seen again in financials it is logical to see this bounce happen, but we will all have to wait and see what happens.
The Euro bounced
Gold bounced 50pts off its lows. Its interesting to hear the difference in commercials for gold right now. Right now I'm hearing commercials telling people to cash in their gold jewelry for cash, where as when gold was near its highs I was hearing commercials telling people to trade commodities like gold.
Crude Oil September contract expired and the new front month contract saw a big pop.
The Euro bounced
Gold bounced 50pts off its lows. Its interesting to hear the difference in commercials for gold right now. Right now I'm hearing commercials telling people to cash in their gold jewelry for cash, where as when gold was near its highs I was hearing commercials telling people to trade commodities like gold.
Crude Oil September contract expired and the new front month contract saw a big pop.
Monday, 4 August 2008
Aug 4 Setup day for FOMC announcement
Right now my next trading goal is to make a ratio indicator between various stock future indices to work on developing a spread trading strategy similar to the one described at the CME website. I'm still day trading my current style, but this is just a side project I'm working on.
Today I pretty much missed all the major swings. I didn't think there was going to be a big move after 8am, but I'm fine with the decisions I made today.
CNBC is reporting some hedgefund blewup in the natural gas arena, so that may be the cause of the selloff in Crude Oil and the commodities. It seems like that happens frequently around this time of year.
My scalps from today (I wasn't at my computer on the afternoon pop, but caught some it after the fact)
Today I pretty much missed all the major swings. I didn't think there was going to be a big move after 8am, but I'm fine with the decisions I made today.
CNBC is reporting some hedgefund blewup in the natural gas arena, so that may be the cause of the selloff in Crude Oil and the commodities. It seems like that happens frequently around this time of year.
My scalps from today (I wasn't at my computer on the afternoon pop, but caught some it after the fact)
Thursday, 31 July 2008
Frustrating Day
Today was a very frustrating day for me. I traded everything today. Bonds, gold, Crude Oil, the stock indices, and the Euro. I'm quiting an hour early because I'm, well, frustrated and don't want to make any stupid mistakes. The morning began with some decent scalps and then getting stopped out on ES 2 ticks away from the morning HOD. That ticked me off.
Next up, the EURO got completely faded after the morning report of the US GDP report that was lower then estimated. Who ever bought the top on this got royally screwed. I bought near the bottom of the day and got stopped out, but made another trade later to trim some of the loss. This trade was probably the most frustrating as I watched the 2yr note make a new LOD at 9:21AM, while the EURO just sat and did nothing for me. I sat in this loser trade down about $150-$250 for over 2 hours. It sucked, but it panned out. The Euro will undoubtedly bounce to 1.558 now that I exited my long. I should have probably traded E7 or made a forex trade instead of a trade on the Euro future contract to lower the P/L swing and my emotion involved in the trade.
ZF versus YM. I got some decent scalps on both of these trading them in an inverse correlated fashion.
At least I'm positive on the day. The Euro is creeping back above where I sold out as I type, but I could care less at this point, as I'm going to the GYM to release some of this negative tension. Believe it or not most of my profits came from long scalps on Gold and Crude oil.
Next up, the EURO got completely faded after the morning report of the US GDP report that was lower then estimated. Who ever bought the top on this got royally screwed. I bought near the bottom of the day and got stopped out, but made another trade later to trim some of the loss. This trade was probably the most frustrating as I watched the 2yr note make a new LOD at 9:21AM, while the EURO just sat and did nothing for me. I sat in this loser trade down about $150-$250 for over 2 hours. It sucked, but it panned out. The Euro will undoubtedly bounce to 1.558 now that I exited my long. I should have probably traded E7 or made a forex trade instead of a trade on the Euro future contract to lower the P/L swing and my emotion involved in the trade.
ZF versus YM. I got some decent scalps on both of these trading them in an inverse correlated fashion.
At least I'm positive on the day. The Euro is creeping back above where I sold out as I type, but I could care less at this point, as I'm going to the GYM to release some of this negative tension. Believe it or not most of my profits came from long scalps on Gold and Crude oil.
Wednesday, 30 July 2008
Crude Oil Rally
Crude Oil Rallied, there was a bigger than expected decrease in crude oil and gas inventories.
Bond Futures Rallied, there is a clear inverse relationship between bonds and stocks still.
I had a bad headache and left my desk at 8:30am. Soon after I left volatility came and I missed some great moves. It was probably for the better though.
I got short ER2 when the Oil number was released only to see ER2 drop a couple ticks and then spike and stop me out, meanwhile, YM dropped 60 pts, I was very frustrated after seeing this move. I should have known better that the divergence between the two was a setup for short on YM and not ER2. I was also long the Euro before the oil number and I made $100 on that trade.
Bond Futures Rallied, there is a clear inverse relationship between bonds and stocks still.
I had a bad headache and left my desk at 8:30am. Soon after I left volatility came and I missed some great moves. It was probably for the better though.
I got short ER2 when the Oil number was released only to see ER2 drop a couple ticks and then spike and stop me out, meanwhile, YM dropped 60 pts, I was very frustrated after seeing this move. I should have known better that the divergence between the two was a setup for short on YM and not ER2. I was also long the Euro before the oil number and I made $100 on that trade.
Tuesday, 29 July 2008
OPEC President & Oil price forecast
Where is Crude Oil headed?
$100 or $150?
The OPEC president made comments last month stating that oil prices could go as high as $150 to $175 this summer.
Although OPEC President Chakib Khelil did say this, if you listen to his interview from May at the last OPEC conference, his reasoning was based on a falling us dollar, money moving out of stocks into commodities because of a recession in the US, and the FED lowering interest rates.
Fast Forward to today, the OPEC president made comments that oil prices are still abnormally high, and OPEC member nations should not cut supply if they continue to fall as the oil market is now in balance. Algeria's oil minister, also said that oil prices could fall to $80 or just below in the long-term if the U.S. dollar continued to rise and geopolitical anxieties eased.
As you can see from this chart, the Euro has been declining (US dollar rising), which may be a reason for the recent decline in crude oil prices.
Not only is Crude Oil pulling back, but all of the commodities that were the superstars during the first quarter of the year have pulled back substantially.
It's interesting to note that the Oil Bull; T. Boone Pickens, has a Wind Energy Plan to help solve our Crude Oil consumption problem. Basically he says the US consumes 25% of the world oil and we well save 300 billion annually (import costs) if we build wind farms in the middle of the country. Although Pickens says that Crude Oil is a problem, last report was that he was still long Crude Oil.(Who knows what his definition of Long is?)
$100 or $150?
The OPEC president made comments last month stating that oil prices could go as high as $150 to $175 this summer.
Although OPEC President Chakib Khelil did say this, if you listen to his interview from May at the last OPEC conference, his reasoning was based on a falling us dollar, money moving out of stocks into commodities because of a recession in the US, and the FED lowering interest rates.
Fast Forward to today, the OPEC president made comments that oil prices are still abnormally high, and OPEC member nations should not cut supply if they continue to fall as the oil market is now in balance. Algeria's oil minister, also said that oil prices could fall to $80 or just below in the long-term if the U.S. dollar continued to rise and geopolitical anxieties eased.
As you can see from this chart, the Euro has been declining (US dollar rising), which may be a reason for the recent decline in crude oil prices.
Not only is Crude Oil pulling back, but all of the commodities that were the superstars during the first quarter of the year have pulled back substantially.
It's interesting to note that the Oil Bull; T. Boone Pickens, has a Wind Energy Plan to help solve our Crude Oil consumption problem. Basically he says the US consumes 25% of the world oil and we well save 300 billion annually (import costs) if we build wind farms in the middle of the country. Although Pickens says that Crude Oil is a problem, last report was that he was still long Crude Oil.(Who knows what his definition of Long is?)
Tuesday, 22 July 2008
US dollar rallies, Crude drops, and the stock market rallies
The August Front month Crude Oil Contract expires today. Oil is down again. I'm expecting a bounce during this short term down trend.
The Euro tanked hard, taking with it Gold and Crude oil.
Bond Yields rose sharply today on a bad auction of the 20yr TIPS. With Bond Yields on the rise, the stock market filled its morning gap.
From Reuters-NEW YORK, July 22 - U.S. Treasury debt prices extended losses on Tuesday after a $6 billion auction of reopened 20-year Treasury Inflation Protected Securities garnered soft demand, traders said.The nominal 30-year Treasury bond fell one full point in price for a yield of 4.68 percent, versus 4.62 percent late on Monday.
13 contracts traded. I did terrible today. I made the mistake of trying to trade crude oil. I only have enough margin right now to trade 1 contract, so I had all my capital tied up in a bad trade while the market rallied. Of course I sold my crude oil $1,000 too soon for a second day in a row. Overall, I'm going to do my best to avoid crude oil. My niche is stock futures, I have no edge trading crude oil. I came close to losing today, but I stuck with it and turned a small profit.
With the action in bonds and with the current Fed speak on interest rates, I'm expecting an interest rate hike at the next FOMC meeting.
The Euro tanked hard, taking with it Gold and Crude oil.
Bond Yields rose sharply today on a bad auction of the 20yr TIPS. With Bond Yields on the rise, the stock market filled its morning gap.From Reuters-NEW YORK, July 22 - U.S. Treasury debt prices extended losses on Tuesday after a $6 billion auction of reopened 20-year Treasury Inflation Protected Securities garnered soft demand, traders said.The nominal 30-year Treasury bond fell one full point in price for a yield of 4.68 percent
13 contracts traded. I did terrible today. I made the mistake of trying to trade crude oil. I only have enough margin right now to trade 1 contract, so I had all my capital tied up in a bad trade while the market rallied. Of course I sold my crude oil $1,000 too soon for a second day in a row. Overall, I'm going to do my best to avoid crude oil. My niche is stock futures, I have no edge trading crude oil. I came close to losing today, but I stuck with it and turned a small profit.With the action in bonds and with the current Fed speak on interest rates, I'm expecting an interest rate hike at the next FOMC meeting.
Thursday, 17 July 2008
The Oil and Airline Pair Trade unravels
What better time to Unravel this long standing trade between airlines and Crude Oil then OPEX week, a week characterized by extreme moves with options expiring on Friday.
Crude Oil started the week above $146 a barrel and is now at $130 a barrel. A $16 drop in 3 days. Meanwhile the airline sector has rallied hard the last 3 days in direct relation with the drop in oil prices. AMR is up 70% in the last 3 days alone.