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Looks that way somewhat. High just after open of 49.10 could be it, but I'm wondering if there might be a spike up when the report comes out. Larger draw in gasoline than expected or lower crude build? Probably wishful thinking.
A quick jump to resistance at 49.50 would be beautiful. Would expect it to dump afterwards. A mixed report btwn crude and gasoline might lead to that and is pretty likely imo.
Happy trades,
-Tim
What's your thinking for expecting more downside, kam? Yesterday's reversal at 47.50 confirmed down trend from 8/10, so continuation expected? Are there other signs that suggest it goes down further here?
My rationale is that we just had first one day bounce from bottom of 10-day vwma-mpd, are at juncture of new trend started 8/30 18:15, and also at the daily pivot (i know you don't give this much credence, but it's still another technical justification).
Thanks,
-Tim
I figured it would bounce here as well. Had finger on the trigger, but I've learned that Kam is usually spot on, so waiting to see which way it starts to move.
I think the pivots I am talking about are referred to as "swing pivots." Anyway, I do find that prices often bounce off of the pivots, especially when there are is other technical support or resistance at these levels. Just extra confirmation for a trade. Yesterday in after hours, for example, oil bounced right at the daily s1 pivot of 45.60 (i wasn't watching so I didn't take the trade). I haven't tried to do any detailed analysis, but it seems like a fairly high fraction of reversals occur within pennies of the pivots.
Thanks,
-Tim
Ha. I see from your post to lms that you do have this as a possible destination.
Does that become highly probable today if we break 45.74?
The definition for the pivots doesn't make the lod one necessarily. They are just on my chart now, so I don't even remember the formulas. The 8/28 low was a pivot for the week, not the daily, anyway. Today's s1 pivot is at 45.71, so it's close to yesterday's low but a bit below it. The next weekly is the s3, which is at 45.27. Does your time machine have that as a destination? What time?!
Was the price being at the pivot level the main reason you were watching for a break, or was it only because it was the previous day's low?
I see you said yesterday 8/28, but you meant the previous day's low (yesterday for yesterday). Damn, I thought I had definitive proof for the time machine... Lol
-Tim
Your post was around 10:30, so if you were referencing the moon lows, you have really given us the proof of your time machine!
Thanks much,
-Tim
Hi Kam. I was tied up at work today and only able to look things over tonight.
At the time you posted this, there had been a low during overnight trading at (or at least close to) the $46.16 level you mentioned (which was also the LOD), and I see that this was also very close to one of the weekly pivots. I assume this is what you were looking at for the target to break below. Does the fact that it tested and surpassed the pivot after a previous bounce from that level make it likely to continue to the next support level? What was your next target based on?
Thanks for putting in a couple posts today on what you were looking at.
-Tim
Sounds just like spidey sense to me! Lol
I guess you've learned to evaluate the indicators at multiple time scales "in your head." I'm not there for sure, and I don't even have the knowledge to decipher the indicators even if I look at them at different time scales. I guess that's more what I would like to learn: a better understanding of how different indicators align to be able to identify likely reversals and when conditions for a high probability trade are present. I do use a couple different indicators and look at a few timescales with them, in addition to watching support/resistance, but my batting average still isn't as good as yours! :)
Thanks for the feedback, and if you have any particulars you're willing/able to share, it's great to be able to pick your brain a bit and extract your sage advice. If you could point out the conditions from time to time that led you into a trade (after the fact) so we can understand the logic/analysis that you put into it, that would be awesome. I understand it's asking a lot to put your thoughts into words and do long-distance tutoring, but you seem to enjoy sharing your knowledge and experience. Some one-on-one lessons from the hedgehog would be most appreciated!
Best,
-Tim
I looked back at the oil chart following Katrina. Oil price actually peaked on the day after it made landfall (8/29/2005) and mostly declined for several weeks afterwards. Some up and down for the first couple days, but the week after hitting New Orleans, wti saw about 8% price drop from the high. There was a price rebound the following week followed by relatively steady decline for a total of about 20% drop in price over the following 11 weeks (although I wouldn't assume the price trend over this extended period was a result of the hurricane).
Refineries were shut down then also. I'm thinking that this may actually cause the demand for crude to decrease since it's the refineries that buy the raw material. Of course supply for gasoline and other fuel decreased so prices at the pump went up, but the effect on crude price seems to be contrary to general expectations. Does this make sense?
Btw, oil services saw quite a different trend. The day of the landfall, they declined a bit then climbed for several days afterwards (~7% by the end of the week) and continued to trend up over the next few weeks. --Maybe GUSH is a better trade?
-Tim
Oh, so I guess pleebs is right. How much do you charge to rent out that time machine?!
It seems that experience and intuition/instinct are a big part of how you gauge the oil market, and it can be nearly impossible to explain what gives you the feeling that something is about to take place. Kind of a sixth sense, or like divining for water, I imagine. I just can't get over how precisely you timed it and your confidence that the next drop was coming!
Best,
-Tim
Damn you're good, Kam! You called the drop literally minutes before it happened. Wish I had been watching the board then. I had actually bought a partial position a little earlier than this point, then I doubled down near the low, and I put in a stop loss for wti below 46.95. I guess I was fortunate that the other scenario you mentioned a little later didn't play out...
Would you mind explaining what analysis/indicators led you to the conclusion that the next drop was coming at that particular point in time and that the decline would either stop at around 47.10 or could continue down another dollar or more? I assume there was some technical setup that gave you the lower targets, but I didn't see it. If you could share and explain what you saw, this seems like it would be a great learning opportunity for me, and I imagine others on the board as well.
Thanks,
-Tim
It had broken thru uptrend line from June but also just finished 5 waves down on the 4hr chart, so not totally unexpected. Nice to get that size jump when only looking for a couple %! Hopefully we get a pullback to the support you mentioned and wash, rinse, repeat.
Nice job. I sold mine at 14.51. My avg purchase was a little higher than yours, but it was a nice trade just the same. Was hoping wti would hit the r5 pivot (48.72) for the day, but looks like it's out of steam. If it does get tbhere, I'll be into dwt for a scalp!
-Tim
Looks to me like it's bottoming here too. I bought some here as well.
Thanks. It's always a guessing game...
-Tim
With eia less bullish than api, I could see an initial drop in price, then a steady rise afterwards since the numbers are still bullish.
Is this about what you'd expect?
Thanks, dollar and My. I used to have the links for these but recently changed phones and lost them with the switchover. I appreciate the info.
Planning to just keep a stop and move it up as we go for now. Will sell what I purchased this morning (only about 15% of what I have overall) if we hit 13.50 today. Looking like this doesn't have endurance right now though...
-Tim
Ok, thx. Where do you get the forecast #s?
I picked up a trading position in pm at 12.57, so happy with the bounce too, but I'm trying to decide whether to hold or take the quick trade. Have shares higher as well that I'll hold either way.
There was a build of 57 bcf for the week. Does anyone know what the forecast was?
I thought your bias was a bit beyond the short term. I guess your previous post, that you moved from D to U, shows what your expectations are then. I bought some GUSH yesterday in my 401k, and a bit of uwti in another acct, but I'll prbbly sell the dwti today and look to buy back next wk.
Thanks for the reply.
-Tim
Hi Kam. Have you switched back to the bull camp or do you think there is still more downside and this is just a ST recovery bounce?
Thanks,
-Tim
Thanks, Kam. I haven't been watching oil that closely lately, but with this recent plunge, I'm considering legging back into U. I appreciate you sharing your perspective.
This is currently touching the line that connects the lows from Feb 2016 and last Nov, i.e. the lower trendline (actually, not technically a trendline since there were only two touches previously) from oil's bottom. Either we get a bounce here or it's going to support around the mid to high 45s, imo. Would like to here Kam's take.
-Tim
-87. Looks like the response will be to the uoside, but close enough to estime that it probably won't generate a huge bounce. I sold some of my Dgaz and will add back later today.
GL,
-Tim
Thanks. The number seems surprisingly low to me, even with the weather we've been having. Makes me wonder if the estimate is low-balled to minimize downside or generate a bounce to let shorts add on. We'll see in a few minutes...
Does anyone know what the forecast for today's report is?
Bought a small position in GUSH this morning pre-market. I looked at the performance during the last year, and it looks like there is actually a slightly increased leverage on oil prices than uwti. It is not directly linked to oil price like uwti, but rather an index. The profile from yahoo finance states: The investment seeks daily investment results, of 300% of the performance of the S&P Oil & Gas Exploration & Production Select Industry Index. There is relatively low volume, so the liquidity may not be great, but hopefully this will improve after the uwti delist if this gains in popularity.
-Tim
Always trying to learn more. I use puts when I am uncertain about selling. Often they expire wothless, but it gives me some peace of mind and has sometimes saved big gains.
Just asking questions and looking for opinions. If you want to give me a hard time, I'll stop asking you, but I do appreciate your experience and feedback if you're willing to share.
Ok, thx. Sounds like a good time to buy protective puts or sell...
With the opec agreement so fresh, I am inclined to hold some in case it continues rising. Would a gap up on Mon after the recent deal be unlikely?
I don't get your point. Care to elaborate?
I just noticed that wti is right on the edge of its 52 wk high according to my chart (tradingview.com). $51.91 is the mark. A break above $53.83 also opens up a big window with no overhead resistance until the $61 range. I'm guessing we'll see a bit of a pullback soon, then a push through these levels. Other thoughts?
-Tim
Same for me. Sold 3/4 of my holdings at 7am for $22.22. Have to wait until market open to sell calls bought Mon. Thank you opec!
It's final. Cut of 1.1M barrels per day.
--
(Reuters) - The Organization of the Petroleum Exporting Countries has agreed its first oil output cuts since 2008, an OPEC source told Reuters on Wednesday.
The source said the agreement was in line with an accord reached in Algiers in September. OPEC member Algeria was proposing to set a new production ceiling at 32.5 million barrels per day, down from current levels of 33.6 million.
(Reporting by OPEC team)
Thanks, Kam.
I have some puts that expire tomorrow, but more than made up for it with my uwti position. I plan to sell some and add back puts as well as some calls, just in case we keep moving higher.