Today at 10:30 AM, I saw a big candle (70.50-69.15) for CLX9. Down by $1350 per contract could be a disaster for someone who doesn't have a stop. Even if you have a stop, it could cost big money due to slippage. Why does CL has these big candles? How to survive in this environment? Was there any news? Is it normal for Crude? I remember seeing similar $1+ candle few days back.. Please consider this a noob question as I haven't started trading futures yet... I'm just watching the chart and taking few paper trades... Thanks in advance. - Su
This is a noob question. Every wednsday there is a crude inventory report at 10:30 ET. Usually has a 1 dollar+ candle on a 5 min bar chart either direction. Any noobs out there beware, do not fade those candles, very bad risk reward, save it for another trade. I bought 20lots at 68.64 avrge, sold 10 at 68.90 and 10 at 69.12 avg. Nice 8k winner, was down 2k going into that trade.
Thanks HO, Trader273 and everyone else for your kind help Trading futures looks very exciting but I'll stay away from it until I understand it fully. So I'll stick to paper trade for next few months. Can you please suggest any reading on CL trading or provide some tips for newbie. I've many confusions Which one to trade - CLX9, CLZ9? What time-frame works for you? How tight is your typical stop? What is your typical profit target? Bla, bla... Thanks,
Note at 4:30 PM on Tuesday (unless Monday is a holiday then it's Wed) they release some other oil inventory report (can't remember the name, too lazy to look). This can also move the market though not as much as today's report. I read awhile ago they are 75% correlated for what that's worth.
Oil rolls over every month so you need to stay on top of things. The roll is usually mid-month, you can watch volume on the next contract and see when the volume rolls over. Make sure you roll in time unless you plan to take delivery (not a problem with IB as they will close it out for you if you don't). CL has been in a trading range for the past 1-2 months with plenty of whipsaws.....I trade it using 5 min timeframe and also daily. FWIW.....no profit target, trailing stops instead and a stop loss around 70 cents per contract.