5% daily swings seem the norm now talk about a lot of hot money flying around in this thing insane I dont know how anyone can trade this thing. Even the options market on this thing is insane, huge spreads, no bids or asks, and just moving all over the show I hate oil. hehe.
If your reactions lie in the 'slow/to dead slow/to paralysed' zone then, no, of course you cannot trade oil (CL) at its fastest. If you know exactly what you are doing, you can. In fact a lot of the time CL doesn't seem fast enough because you get so used to the fast pace of the session (as compared to YM & ES). The fastest points at upmove spike peaks and at downmove reverse spikes can be nailed with a trained mind. You are operating inside 15 seconds and you are awaiting the precise moment to trade such peaks and dips.
I dont daytrade, thats why this sucks even more. I was thinking that oil was overdone, and maybe a few weeks of calm would occur after last friday. But this week has been equally as chaotic as last week. IV is through the roof. I have no idea where oil is going thats for sure. Like i said I thought maybe some consolidation and calm, you know, peaceful ranging between 122 and 139 over weeks, but now it looks like it wants new highs...... 5% swings all over the place. mutter, grumble....
These significant moves intraday in oil remind me of when the YM was moving 600 points down then closing flat intraday back around Q4-07/ Q1-08. We all know what happened when that came to a close. Down 600 and stayed there, then down a few thousand in coming weeks. So if this volatility is any indicator, it could mean a bigger trend is in store for oil. Even the "legally (cough cough) price manipulating" institutional traders don't know which way it will be going or they would already have taken it there. If it fits your trading style, make big money. And if it does not, sit it out.
The oil stocks have stalled. To me this is always an indicator that the price has limited upside. Plus negative divergences. My guess is a top is near in the next week or two. June 21 is the summer solstice...markets can turn around this time.
I am just starting to demo trade oil spot contracts. As a person who has traded equities and forex the volatility in crude is just unreal. Have a squeeze indicator on the chart along with some momentum indicators. Since I have a dayjob that requires most of my time, my goal is to trade is just before NY opens around 6 am or so. I found a broker that sells "micro" 250 barrels per forward spot contract, good for someone like me with low risk tolerance
i've been catching some of the volatility over the past few weeks in one account. it's been some crazy days the last two weeks.
oil is too high and i would love to short it and ride it to 100, but it's relationship to the dollar and the weakness of all world markets makes it a place to park cash ,sort of like gold,it has taken on a new identity,so i play it with the xle and uso,less volatile