Day Trading Crude Oil Futures 6.08.2016
Posted By:- Ilan Levy-Mayer Vice President, Cannon Trading Futures Blog
1. Market Commentary
2. Futures Support and Resistance Levels – S&P, Nasdaq, Dow Jones, Russell 2000, Dollar Index
3. Commodities Support and Resistance Levels – Gold, Euro, Crude Oil, T-Bonds
4. Commodities Support and Resistance Levels – Corn, Wheat, Beans, Silver
5. Futures Economic Reports for Wednesday June 08, 2016
For 2016 I would like to wish all of you discipline and patience in your trading!
Crude Oil numbers tomorrow morning. As of lately it has been one of the more followed reports by all markets…..
I wrote this piece about day trading crude oil futures a couple of years ago and it is still very valid in my opinion:
Trading 102: Day Trading Using fear and greed ( using Crude Oil futures as an example)
Crude Oil Futures volatility offers a “different market personality” than stock index futures. Here is some of the things you need to know about day trading crude oil futures:
By: Ilan Levy-Mayer, Cannon Trading Commodities Broker & VP
Crude Oil is one of MY favorite futures markets for day trading. Before I dive in and share with you how the volatility in crude oil fits my risk tolerance for day trading and provide a couple of chart examples, we should review some of the specifications of Crude Oil Futures.
Crude Oil Futures have monthly expiration. So each month we trade a different contract month, so one needs to know when the first notice day and last trading day for crude oil futures are, in order to always make sure we are trading the proper month with the most liquidity and avoid any chance of getting into a delivery situation.
Next is the contract size. Crude Oil futures are based on 1000 barrels. To be honest from a day trading perspective all I care is that each tick or 1 cent fluctuation is $10 against me or in my favor per contract. That means that a move from 92.94 to 92.74 = $200.
Another factor is trading hours. At the time I am sharing my thoughts with you, April 8th 2013 ( I wrote this one a while back but the examples and logic are still very current!) , crude oil futures trade on the CME Globex platform and trade from 5 PM CDT until the next day at 4 PM CDT. That is 23 of straight trading hours. I definitely don’t recommend day trading this market 23 hours…but it is good to know the trading hours.
Volume in crude oil futures is pretty good to trade in my opinion. Averaging about 300,000 contracts per day.
One last pointer to touch on is the EIA (Energy Information Administration) report that normally comes out Wednesday at 9:30 CDT (on short weeks, holidays etc. , this report will be pushed to Thursday at 10 AM CDT). I tell my clients that this report is way too volatile and I like to be out 5 minutes before and not resume trading 5 minutes until after the report comes out. This report by itself deserves a writing but on short, the report provides information on how our stock pile is doing ( = supply/demand) and the market will move based on the numbers versus what was expected. Again as a day trader, your main job is to know about this report, when it comes out and in my opinion stay out of the market during this time…
Read the rest of the article along with chart examples, specific trade set ups and other trading tips which can be applied to many markets not just the crude oil market
Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
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|Contract June 2016||SP500||Nasdaq100||Dow Jones||Mini Russell||Dollar Index|
|Contract||Aug. Gold||July Silver||July Crude Oil||Sept. Bonds||June Euro|
|Resistance 3||1263.3||16.76||51.95||167 8/32||1.1424|
|Resistance 2||1256.2||16.62||51.24||166 31/32||1.1403|
|Resistance 1||1251.2||16.51||50.86||166 22/32||1.1382|
|Support 1||1239.1||16.27||49.77||166 4/32||1.1340|
|Support 2||1232.0||16.13||49.06||165 27/32||1.1319|
|Support 3||1227.0||16.02||48.68||165 18/32||1.1298|
|Contract||July Corn||July Wheat||July Beans||July SoyMeal||July Nat Gas|
Manufacturing Production m/m
Industrial Production m/m
NIESR GDP Estimate
JOLTS Job Openings
Crude Oil Inventories
10-y Bond Auction
RICS House Price Balance