Heating Oil spreads

Discussion in 'Energy Futures' started by actionzip54, May 8, 2013.

  1. I am fairly new to spread trading but not trading in general.

    I'm starting to get interested in getting long some Heating Oil bull spreads as I think there is going to be an increase in demand in the front months.

    Anyone else here trade heating oil spreads.

    I am currently long the Jun13-Aug13 spread at 24 and will be adding to gains if I can realize them.
     
  2. so your basically taking a long position in the underlying selling front month calenders?
     
  3. Essentially yes.
     
  4. I'm assuming more demand is going to come into the market and create a backwardation. The underlying could rise and I can still lose money. It's still a relative value bet, but yes typically this spread will gain if you get a rise in the price of the commodity.
     
  5. i get it.. by why not offset the risk with a long calender in the next expiration? i wanna watch this trade with you.. i'm sort of new to futures.. been looking at ng and cl... i'm in a bear spread in cl now.. super small ..
     
  6. [​IMG]
     
  7. What chart is that? That is not the spread I'm in and it doesn't look like the Jun13 outright.

    I know you where in NG I saw you where long a call butterfly. Personally NG looks like a possible short tomorrow on the outright and for the near future although I wouldn't intiate a intermediate term short here. I'm also bullish CL but dont have posistion and I think a close above 97 on the June would def make me start to lean bullish and look for a Higher Low to confirm.

    I am, however, the most bullish on RB and HO and will probably put on a Jun-Aug RB spread tommorrow as well if the price action is right.

    GL with your trades and I am also only long a 1 lot on my HO trade which is lol small but whatever I'm not going to light money on fire when I know how to trade outrights and I'm just starting to learn and get comfortable with the spreads.
     
  8. I also like ZL, Soybean Oil, as well.

    Anyways post away it will be nice to play with and learn this stuff together. Any and all insights you have would be much appreciated.
     
  9. Also nevermind on what that chart is. It's just the graphical form of the curve.
     
  10. obviously you know you can be right on direction and still lose on the spread... hard to say where NG is going.. i'm not in it for the long haul... but i think its respecting resistance as of right now.. if i lose i lose.. i thought about that before i got into the trade..
     
    #10     May 8, 2013