I certainly hope so, I'm doing it every day. By than I mean I will hear about CL on CNBC/Bloomberg in the back ground but I don't keep the symbol on my screen.
Interesting thread. While I believe it is totally possible to trade without looking at the price of oil, over the past 3 weeks at least it has been very profitable to initiate negative correlation trades between the index futures and oil depending on the movement in oil. Lately the time differential between when oil moves and the equity's market response is getting smaller and smaller but a couple of weeks ago you might have 30 seconds to a min to get in long on ES (pick your poison) if you saw a big drop in oil or major resistance get blown through. I have had full time oil chart up and running while trading the ES for about 3 months now and was watching it closely prior that, although i never had one chart on top of everything anchored to it. Soon, I believe the movement of oil on the equity market will have run its course and it will be much less useful, however it does seem to still be working for the time being. I particularly find Jayford and some others' comments about intramarket trading interesting, because, without ever deeming it as such, I think this is primarily how I trade. I use bonds (primarily the 10 year), the ES YM NQ and ER2, the euro/usd, big cap tech stocks, financials (big stocks and the etfs) and energy stocks to watch for crosscurrent effects to give some clue as to where the market maybe heading. Bonds are very useful imo, however occassionally it seems that stocks will ignore bond market moves in the short term, intraday, before making a move that would make sense in the context of what the bond market is doing. Of course the bond market is wrong from time to time. I have found the move in bonds interesting over the last two days because it seems less to me like a flight to safety is occuring, which has been the case for the rallies in the bond market over the last year or so. Some of it has to be the spread widening of GSE debt over treasuries and the big demand put up in the government auctions yesteryda and today. But I think the healthy demand is the interesting part. Makes me wonder if we are getting just a hair more liquidity in the debt markets. Anyway just my two cents. Very interesting thread - thanks for brining the subject up.
excellent...reply...over the last weeks I have tried once and then again and then again...to put away the CL Oil price from my trading platform...but...is has just seemed too important to dictate where the Indexes are going...say indexes are weakening, I can lookf at Oil to see if a huge Oil move is underway and the Indexes will totally fall apart...for me, I've looked at many market relationships with other markets and it seems the strongest and clearest is that of Oil to Indexes...I've looked at Bonds but can't seem to see it, same with Euro...it seems as only Oil is a true "driver"....Gold, Euro and Indexes follow...unless of course something like banks, earnings drive Indexes into the ground alone...thoughts?
Yes, it is definitely crude that is the driver. bonds are just very highly correlated, they don't actually "cause" the move in stocks, just move opposite to the same data most of the time. Here is today's action, 5 min of both bonds and ES overlayed. you can clearly see that a huge bond rally preceded stock drop by 30 minutes or so. I actually used this to setup for the ES drop drop today. (used other things too).