CL week of 4/25

Discussion in 'Commodity Futures' started by ethanol, Apr 24, 2011.

  1. ethanol


    Been reading the board for awhile but have never posted.

    Any opinion on WTI this week? You can argue both ways that Thursday's close was/wasn't bullish. It didn't make a new high during the day session, with light volume it would've been pretty easy for a little bit of size to breah 113.50.

    IEA was bearish new last week, Mastercard reporting RBOB demand, Obama going after the speculators, the Fed meeting wednesday..... All pretty bearish. I would surprise me if they raised margins this week too.

    So i'm pretty bearish this week, I still think we're range bound from 103-113, given its a ten dollar range, i think the chances are we test lows this week.

    Just too many problems and issues to make new highs.

    I think the dollar trade will be coming to end sooner than later. Its an excuse trade anyway, there is no true correlation.

    any opinions?
  2. It won't move till Fed
    If Fed insists there is no inflation then 116-118 by the end of week
  3. Feel free to define 'won't move'.

    Of all markets, oil is the absolute last market I would refer to as 'won't move'.
  4. in my opinion won't move is 2$ range
  5. Well today's high = 113.48 and low = 111.08

    In about 1.5 hours of trading, oil has moved $2.40 and exceeded your range quickly.

    That's just 1.5 hours of trading. On a Monday. With very little scheduled econ news.

    We still have the rest of Monday, all of Tues and part of Wed before the announcement.
  6. bone

    bone ET Sponsor

    June RBOB Gasoline Crack Spread, which is the NY Harbor RBOB Gasoline Contract versus the WTI Crude Contract:


    June Nymex WTI Contract versus the June ICE Brent North Sea Crude Contract:

  7. basically I was right about the range before Fed and what Fed did
    now let's see if it goes by 116 by Friday close
  8. J-Law


    On that chart you posted on the June RBOB/Crude crack, what/how is the multiplier
    on that product spread? If memory serves me correct I think the only way I can get that off with an IB acct is via legging in. Gut tells me I may be asking for trouble with an execution like that regardless of how smooth that spread is.

    But, those dips do look enticing

  9. bone

    bone ET Sponsor

    J-Law, that is an exchange-supported implied spread. Has been since Nymex (pre-CME merger days) first outsourced to Globex for their electronic trading engine.

    The exchange internally matches the legs for you. Indeed, the order book looks like a flat price instrument ladder, but when you get filled you see the individual leg quantities and prices in your fill window and later on in your statement.

    Implied spreads are awesome, and we use them whenever and whereever available - be it CBOT Yield Curve, CME Eurodollars, Liffe Euribor, Corn, Beans, Nat Gas, the ICE Gas/Oil Crack.

    ICE matches the Gas/Oil Crack, the Brent/WTI spreads, and all of the calendars. Nymex matches all the calendars and all the cracks.

    We trade Flys and Condors using the exchange implieds as well - it is a very beautiful thing.

    The great thing about the implieds, other than execution risk mitigation, is the fact that they also support stop-limit electronic orders. So, I can have GTC risk stops and resting profit target orders working in the markets at all times.
  10. J-Law


    Thanks, Bone.
    Yep, I'm familiar with the implied spreads engines. I remember Watching that presentation that CME posted to their site when they first introduced it. Great stuff. Makes exchange listed spread liquidity completely accessible. Yes, def a great way to harness the electronic platform for products that you in the past required a call down to the floor clerk for a mkt. Tech is head & shoulders over the old way.
    Because it is an inter-contract spread & not an intra-contract spread was wondering how you figured the spread multiplier with two different contract ticks? RBOB has a $4.20 tick & WTI has a $10 tick. So in your example, if we lifted the spread at 25500 & then offered it back out at 280000. How would you figure the p&l?
    #10     May 7, 2011