An amateur starts a thread

iainBB

chompdown wrote: »

A wonderfully ugly hourly chart for the Dollar today as it moved down to 95.00

The next trade will be long oil. I will start to scale in when I get the nod. I will be using the €500 August bank for this, with a stop at a loss of €500. Expected to be later this week / early next.

Max position will be €2.5 per point (WTI futures are per cent rather than per tenth of a cent)

Oil is below 40 dollar which is a significant number a barrel right now and futures are not looking good with over supply and week demand globally. But there may be support at 40 dollar a barrel.

chompdown

Yes, a lot of bad news for oil right now which is needed when a bottom is forming. I will be buying when everyone else thinks I'm completely wrong (again!).

I am waiting for at least one more large down day and then a reversal with high volume. This means I won't get the exact bottom but that doesn't worry me at all.

The bottom could be already in at just under $40 but I doubt it. We will soon see!

chompdown

Position 2
Trade 1 just executed
€0.5 per point long US Crude @ 40.135

iainBB

chompdown wrote: »

Position 2
Trade 1 just executed
€0.5 per point long US Crude @ 40.135

Oil bounced off resistance.

chompdown

Yes, bounced very nicely and the volume is telling us something. Still waiting to go all in, but trade 2 has just been filled.

Position 2
Trade 2
€0.5 per point long US Crude @ 40.865

chompdown

Position 2
Trade 3
€0.5 per point long US Crude @ 41.095

Currently long €1.5 with another €1.0 to add.

chompdown

Absolutely looks like a low in oil is in, with nearly all of the boxes ticked. Only one remains, and this move came a little earlier than expected so I'm planning to keep the last 1.0 in case there is a move to retest the lows.

I expect I will be adding at higher prices though.

chompdown

Position 2
Trade 4
€0.5 per point long US Crude @ 40.555

iainBB

chompdown wrote: »

Position 2
Trade 4
€0.5 per point long US Crude @ 40.555

I think oil will bounce around that resistance way to much supply and low global demand and old technology going out of fashion.
Might see another green tomorrow after surprised gasoline story but it screams sell.

chompdown

iainBB wrote: »

I think oil will bounce around that resistance way to much supply and low global demand and old technology going out of fashion.
Might see another green tomorrow after surprised gasoline story but it screams sell.

Respectfully, when you start to see posts like this it's an indication that the bottom is close. Just when everyone thinks it's a screaming sell and all the news stories are negative, it's time to sit on the sideline or do the opposite.

Yesterday's low was probably the bottom but it may retest that over the next week or so before a big bounce. I just hope I can hang on in there again!

Current average price is 40.663
Stop set at 38.163 for a loss of €500

For ever odd

Defined risk: check
Entry points: check
Exit points: in my opinion this is the hardest one of the three to keep discipline (starting out anyway).

Glad to see you found swing trading suits your personality.

chompdown

Totally agree with this also. The unrealised profits on my account are exactly that and can be wiped out very quickly. Just as I got the nod to buy, I will also be told when is the time to sell.

Markets run in cycles and that's what my trades will try to reflect and follow. Both the Dollar and maybe Oil already should now be in longer term cycles which will have corrections along the way. When those corrections are due, I will sell or reduce my stake (but not take the opposite side of the trade).

I'm confident that if I can stay disciplined with my stakes and follow the rules above this will continue how it has started; well!

Another big news day today for the Dollar. The NPF jobs report.

chompdown

Big job numbers again this month, and this is the first piece of news to go against my positions since the start of the thread. Initial jump in the dollar and sell off in oil. This week's screenshot won't be as celebratory! The beginning of the end?!

chompdown

The above mentioned jobs report meant this was my worst week of the three so far, but I was delighted to see oil reverse and the dollar give back nearly half its gains after almost getting up to its 200 DMA.

I must say I am very happy with the start, and especially my lack of panic today with the bad news. I think this thread is helping me stick to the rules.

The balance is higher as I deposited the €500 for August this week.

Week 3 update
Total deposits: €1473
Position 1: Short USDX (Sept) 0.8€ @ 97.182
Position 2: Long US Crude (Sept) 2.0€ @ 40.663

Current balance: €2519
Weekly change: -€268

Total P/L: €1046 / 71%

I've had to merge two screenshots together to get this weeks one. Hope it comes out ok.

delaney001

chompdown wrote: »

Position 2
Trade 4
€0.5 per point long US Crude @ 40.555

Enjoy the thread as a noob.
Noob question what does 0.5 per point mean? Have you a figure set at the start to multiply this against for each trade?

drunkmonkey

delaney001 wrote: »

Enjoy the thread as a noob.
Noob question what does 0.5 per point mean? Have you a figure set at the start to multiply this against for each trade?

Means he looses or gains 50c a point on oil movement up or down depending on leverage and I reckon he's using 100%, I think he's stone mad betting it'll go up without hedging that bet. A swing down to $35 a barrel will clean him out.
You should set up a free demo account in etoro to start playing around on real markets with virtual money.
Noting happening at the weekend, currency's start at 10 Sunday night https://www.etoro.com/en/customer-service/market-hours/

You can buy oil like he's after doing and see how you get on.

China just announced its electric charging stations have surpasses gasoline stations, I let you guess where oil is going.

If he's going long he's betting it'll go up, if he shorts it he's hoping price will fall, bull market is going up and bear is going down.

I'm shorting it by the way : )

iainBB

drunkmonkey wrote: »

Means he looses or gains 50c a point on oil movement up or down depending on leverage and I reckon he's using 100%, I think he's stone mad betting it'll go up without hedging that bet. A swing down to $35 a barrel will clean him out.
You should set up a free demo account in etoro to start playing around on real markets with virtual money.
Noting happening at the weekend, currency's start at 10 Sunday night https://www.etoro.com/en/customer-service/market-hours/

You can buy oil like he's after doing and see how you get on.

China just announced its electric charging stations have surpasses gasoline stations, I let you guess where oil is going.

If he's going long he's betting it'll go up, if he shorts it he's hoping price will fall, bull market is going up and bear is going down.

I'm shorting it by the way : )

Agreed. I am not an expert in commodities and don't invest in them but I did have a look at charts and TA ,after reading this tread and would have stayed away as it bounced around the resistance.
Avoid leveraging .

Okon

delaney001 wrote: »

Enjoy the thread as a noob.

Me too. I actually think this is one of the most interestng threads here! Very enjoyable.

I only have a basic understandng of spread betting/commodity trading, which seems way too risky for me or my money, but I hope the OP does well out of all this. Maybe I will even learn something?

So good luck Chompdown... and thanks for keeping us entertained.

delaney001

drunkmonkey wrote: »

Means he looses or gains 50c a point on oil movement up or down depending on leverage and I reckon he's using 100%, I think he's stone mad betting it'll go up without hedging that bet. A swing down to $35 a barrel will clean him out.
You should set up a free demo account in etoro to start playing around on real markets with virtual money.
Noting happening at the weekend, currency's start at 10 Sunday night https://www.etoro.com/en/customer-service/market-hours/

You can buy oil like he's after doing and see how you get on.

China just announced its electric charging stations have surpasses gasoline stations, I let you guess where oil is going.

If he's going long he's betting it'll go up, if he shorts it he's hoping price will fall, bull market is going up and bear is going down.

I'm shorting it by the way : )

Thanks, that's a really comprehensive answer.

chompdown

drunkmonkey wrote: »

I'm shorting it by the way : )

iainBB wrote: »

Agreed. I am not an expert in commodities and don't invest in them but I did have a look at charts and TA ,after reading this tread and would have stayed away as it bounced around the resistance.
Avoid leveraging .

This is not the time to open a short position in oil unless it is very short term (less than a week). Oil is looking for a cycle low, which may or may not have already come last week, and after that it's going to gradually move higher for a number of weeks.

Your only hope is if there is a sell off in stocks next week (likely) that brings oil down with it. As this is actually likely to happen, I will reduce my exposure to oil tonight when the market opens. That's a lot different to going short though

ixus

chompdown wrote: »

This is not the time to open a short position in oil unless it is very short term (less than a week). Oil is looking for a cycle low, which may or may not have already come last week, and after that it's going to gradually move higher for a number of weeks.

Your only hope is if there is a sell off in stocks next week (likely) that brings oil down with it. As this is actually likely to happen, I will reduce my exposure to oil tonight when the market opens. That's a lot different to going short though

Whether the market goes up or down, you really haven't a clue what you are talking about. Not trying to be rude here but highlighting this for the other newbies who are following you. This is what I was concerned about from the start.

Oil does not track equities. Ever. It reacts to supply demand constraints, FX moves and geopolitics. Equities react to oil moves at various times for mutiple reasons.

chompdown

ixus wrote: »

Your short $ trade is betting the FED are dovish and/or that Bank of Japan don't launch a massive easing program on Thurs. Basically, the opposite of what's expected.

Well, you were wrong earlier when you posted this, so I am wondering will you have egg on your face again if US equities and oil go down together next week.

ixus

chompdown wrote: »

Well, you were wrong earlier when you posted this, so I am wondering will you have egg on your face again if US equities and oil go down together next week.

No, I wasn't "wrong"..... I told you how you were positioned into two major FX events and what market expectations were. Highlighted your risk exposure.

I won't be wrong either if US equities and oil go down together either. I've explained why already. Oil won't sell off because equities do. Why has it only recwntly sold off $12 or 20% while the S&P makes all time highs then? The S&P might reverse if oil breaks $40 due to its effects on earnings to Exxon etc and forcing Sovereign Wealth Funds to liquidate positions for cash. This is what happened in Aug and Jan.

And, if oil & equities sell off, you can be sure your USD$ position will rally

Your p&l does not matter to me. As a Mod, you're highlighting of some secret chat room telling you to take or exit positions does because it may suck others in.

drunkmonkey

chompdown wrote: »

Well, you were wrong earlier when you posted this, so I am wondering will you have egg on your face again if US equities and oil go down together next week.

The rise in Oil last week was put down to short covering, the Bull market ran out of puff when this was complete last week, Oil still remained a sell even though it climed higher.
If your going to bet on it going it up, hedge that position with a sell or your basically gambling on black or white.

My golden rule is don't touch oil, I broke it last week and suffered the consequences, if it starts rising Monday I'll buy just to cover my shorts but I'll be taking profits on those hedges at first sign of it going down, I hope to get out of Oil Monday completley without a loss.

chompdown

ixus wrote: »

No, I wasn't "wrong"..... I told you how you were positioned into two major FX events and what market expectations were. Highlighted your risk exposure.

I won't be wrong either if US equities and oil go down together either. I've explained why already. Oil won't sell off because equities do.

Ok so it sounds like you can't be wrong. I'm sorry but it comes across that you are almost wishing me to fail. Maybe I am being too sensitive.

I've put a number of disclaimers out there in this thread saying this will end badly, I am over leveraged, I lack discipline, I am an amateur etc. Not sure what else I can say. If you are worried about others contacting me, please disable my instant messaging.

Let's see what happens next week. The proof will be in the pudding. I'm prepared to be proven wrong.

ixus

Of course I can't be wrong. I am highlighting risks. Not calling trades.

I don't wish failure on anybody. It is quite the opposite.

I've highlighted risks to your strategy of following someone else's trades, of events that might cause the market to go heavily against you and how, if the market was to trade heavily against you, it would not care that you only had 1k or whatever in your account. You could end up owing mutiples of that in a major event.

chompdown

For the avoidance of doubt, this is how I see it will happen next week.

There should be a sell off in equities, and this will lead to oil following equities down. I'm obviously not sure if this will actually happen, so I am only selling one, max two portions of my long oil trade. I will add back after it has moved up on heavy volume.

The dollar failed to break or even get to the 200 DMA so I expect weakness in the dollar to resume after ending strongly last week.

Edit to add: cheers ixus, yes all very valid points. Maybe my slight hangover is making me too sensitive.

chompdown

Just to add further, and with the caveat that correlation absolutely does not equal causation, the daily moves for the S&P last week:

DOWN, DOWN, UP, UP, UP.

And the daily moves for oil (copy paste the above)

DOWN, DOWN, UP, UP, UP.

So let's possibly see a move down in both together next week, then a full re-entry for me, as Oil finds the bottom of its current cycle. I don't care what happens with the S&P from that point onwards.

chompdown

chompdown wrote: »

Position 2
Trade 1 just executed
0.5 per point long US Crude @ 40.135

Closed at 41.895
Profit 40

chompdown wrote:

Position 2
Trade 2
0.5 per point long US Crude @ 40.865

Closed at 41.865
Profit 50

chompdown

chompdown wrote: »

Position 2
Trade 4
0.5 per point long US Crude @ 40.555

Closed at 42.615 with profit of 103