Iran Gave Me A Very Good Trading Opportunity.

This was the news that enabled me to make an unexpected but very profitable trade:

"Crude oil futures ended higher Monday following reports that Iran is holding five British nationals after seizing a yacht that may have strayed into Iranian waters. Oil had been trading close to unchanged to slightly higher for much of the session, largely tracking the day's slight fluctuations in the dollar and equity markets. But futures spiked late in the session to $78 a barrel on reports that Iranian navy vessels on Nov. 25 had stopped the yacht, owned by Sail Bahrain, that was crewed by the five British nationals."

As soon as I saw the spike in the oil futures right after the news hit the wires, I let oil runnup a bit and I started shorting oil futures. I nearly caught the intraday highs and I rode it lower with a sizable position for an intraday play.

This trade was done when I had was already ending my trading session. But I love these trades. I had a similar one over a year ago when CNBC had this breaking news, "FED will lend X billion dollars to Bear Stearns". Actually the stock went up in the minutes following the announcement when it was obvious to me that if the FED was lending money to an investment bank, probably it was because insolvency was the issue to deal with. The stock plunged 50% in the afternoon trading and I made over 50,000 USD in a few hours.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Trading Stories. This One Is Great.

Last night I had dinner with some brokers in a party I`ve attended with my wife. We were talking markets even though I do not really like to talk about the market when I am out of the office. But these guys are funny and always have some nice war stories to tell about their costumers.

This one I think its inspirational for all of us. One of the customers opened an account in July with 60,000 USD. He only traded Dax Warrants during this period and he was able to run his account to an astonishing 1,670,000 USD a few weeks ago. Then a small disaster struck and the account come down to 300,000 USD but right away he rebuilt it to 800,000 USD. Of course this was all before this Dubai`s mini-crisis and I can`t wait to know what has happened to his trading account in the last 2 trading days.

Anyway, this client is a medical doctor over 60 years old that placed most of his trades through the phone because he thinks trading platforms are not user friendly...What about that?

Another 2 interesting numbers. Only 8% of all these brokerage house customers are able to win over an extended period of time and the median lasting time of a trading account before it goes to ZERO is 6 months. Where does that money go to? To the trading pros, of course.

TraderHMS offers a premium subscription where he shares his market views, some of his trades and selected market data with subscribers. For more information visit the Membership page. You can also email traderhms(at)gmail.com to get a 10 day Free Trial.

Best Week In Months. Back To My Best Trading Form.

It was a fantastic trading week for me. Now its time to relax and rest a bit. I am feeling exhausted because I had 3 hours of sleep in the last 2 nights. Why? This time it was not Enzo`s fault. Mr. Market kept be awake but I was paid handsomely.

I am back to my trading form. I hope the markets keep providing opportunities in the next few weeks.

My only position now is a long-short, long refiners and short the S&P Futures. Its a market neutral position for the medium term. I was even forced to take some profits on the Nikkei Futures as they rallied over 100 points in the afternoon.

In the mean time there will be other battles to be fought, but I do not know the time, the place or the opponent. Time will tell.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Took My Profits On Globex`s Extreme Weakness. Time Will Tell If It Was The Right Move.

I recall Jim Rogers sage advice, "Buy Panic, Sell Hysteria". That is what I did this morning. I bought back my shorts in oil, S&P Futures, Gold and closed my dollar longs except for the USD/JPY cross.

My Red Ship was fully loaded as you know so I made a killing in the last few days. Time will tell if I am leaving much money on the table in this premature closing. But when panic sets in we have to take advantage and close positions.

I took advantage of the Nikkei weakness and bought some futures contracts at 9100. I think its a low risk trade that has some upside potential and little downside risk.

So, all in all, I still have a short position on Market Vectors Gold Miners (ETF): GDX that I plan to close out today and some long positions on the refiners, Tesoro (TSO), Valero Energy (VLO) and Western Refiners (WNR). They were all in the money till wednesday. Lets see how they perform today.

My trading form is back and I couldn`t be happier.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

I Have A Big Short Oil Position. Oil Will Crash.

I added to my oil shorts because I expect oil to drop several dollars in the next few days. I am already well in the money in thsi trade but I think oil can reach 70 dollars in a few trading sessions. If the middle east has a liquidity problem where will it find its needs? Selling oil.

I am also long USD against the Euro and the Yen, short Gold and short the S&P`s. These couple of days will be days to remember as my Red Ship is loaded. Fully loaded as a matter of fact.

The liquidity run has reversed. Dollar is king again even if its only for a coouple of days.

If you want to chill out a bit while you wait for tomorrow`s profits to begin to come in, go to Jose Gonzalez`s myspace. My favourite artist. Listen to the track "Down The Line", which means "there`s trouble down the line". And its not mine.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Is Dubai Defaulting Its Sovereign Debt?

This is the headline that is making all things work in my favor.

"Dubai is shaking investor confidence across the Persian Gulf after its proposal to delay debt payments risked triggering the biggest sovereign default since Argentina in 2001."

Dollar is rallying, S&P Futures selling off, Crude Oil Futures down. With one of the middle east big players facing liquidity problems I think its a no brainer that oil will be sold heavily.

Do you remember me saying that oil was weaker than everything else because it could not rally when the dollar sold off and was trading near the bottom of the trading range while other assets were close to the year`s highs? Well, we could not tell why at the time, but now we know the reason: Dubai`s liquidity issues.

If I am right, oil futures will plunge to 70 dollars a barrel in no time and major players will rush to the US Dollar for a safe heaven again. Isn`t this beautiful?

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

The US Dollar Is Making A Major Bottom

The US Dollar is making a major bottom, at least in the short to medium term. I bought USD/JPY at the end of the trading session and opened a reasonable position short EUR/USD. I plan to add further to this trade when I am confident that I am right and the market begins to move in my favor.

The refiners I had bought yesterday did fine, with Tesoro (TSO) and Valero Energy (VLO) rallying nicely and Western Refiners (WNR) losing little ground from yesterday`s big rally.

I am pretty active on several market fronts. I did well in the Nikkei Futures overnight because I was able to buy them yesterday in the US sesion with a 50 plus discount and the Nikkei 225 rallied 40 points, so I was able to net 90 points in a 10:! leveraged position. Not bad.

I don`t have any position in the Nikkei Futures for today, but I am involved in the S&P Futures (short again), in the refiners and initiating a major dollar long position. Marc Faber said recently that we was long dollars. He is already down a couple of hundred ticks but I also expect a dollar rally in the next few weeks. I enjoyed reading this passage from Associated Press,

"The safe-haven dollar slid to a 15-month low against the euro, was within striking distance of 14-year lows versus the yen and dipped below parity against the Swiss franc Wednesday as markets absorbed the Federal Reserve's indication that interest rates will remain at super-low levels for a while and it was not overly concerned by the U.S. currency's decline."

I am watching the best goals from today`s CL matches. My favourite is Milos Krasic long-range missile against Wolfsburg. Unfortunetely I cannot link the video because it is not available on Youtube due to copyright infringements. Maybe we can find it there tomorrow.

Happy Thanksgiving.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Bill Gross Bearish On China

Bill Gross joins Jim Chanos in a bearish China investment call:

"The investment guru who runs the world’s biggest bond fund at Pimco, Bill Gross, says a speculative bubble is emerging in China.

Real economic growth there is still constrained by limited consumer demand from the United States and other trading partners

Gross told Bloomberg News that the Chinese will have “a bubble of their own” to confront shortly."

Time to short some red hot chiese stocks?

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Bought Western Refining (WNR)

Yesterday I bought Western Refining (WNR) on what can be a reversal day for that stock. I am following the refiners for a long time and they are all quite depressed. Yesterday WNR surged with big volume. I am taking a shot.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

FED Minutes Are Very Bearish.

Fed Minutes were very bearish in my opinion but they did not spark a sell off. Maybe tomorrow?...

Federal Reserve officials said record-low interest rates might fuel “excessive” speculation in financial markets and possibly dislodge expectations for low inflation, according to minutes of their meeting released today.

“Members noted the possibility that some negative side effects might result from the maintenance of very low short-term interest rates for an extended period,” minutes of the Nov. 3-4 meeting said, “including the possibility that such a policy stance could lead to excessive risk-taking in financial markets or an unanchoring of inflation expectations.” in Bloomberg


Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Great Trading Day. Big Oil Short Pays Off.

I had a great trading session. I was active, focused, confident and luck was on my side. I started the session with a major oil futures short position that really paid off and a moderate short line on Market Vectors Gold Miners (ETF) : GDX and S&P Futures. During the session I traded EUR/USD and I bought a few refiners like Western Refining, Inc. (WNR) that rallied big time. In the meantime I bought CME Nikkei Futures with a 50 points discount to the japanese cash close and I am planning to further capitalise on them overnight.

I am exhausted but it really paid off. Its a 2009 Top 10 trading session for me.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Prechter Is The Bear Of All Bears

The famous or infamous stock market strategist Robert Prechter made some very bearish comments regarding the stock market performance in 2010:

"I think we’re in for a very large decline in the S&P in 2010. I think it’s going to be at least as what we saw in 2008. That very bearish prediction is because so very many investors have turned bullish. In the first quarter only 2% of traders were bullish and now we've got over 90% bullish"

To that he added,

"Because during the 8 months of rally, there's been a real contraction in momentum. There's been a decline in the Advance/Decline ratios that have been going up as well as a decline in volume."

I am not a big fan of Bob Prechter but he has a huge following and has certainly has made his name on the street.

Have a good trading day.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Bearish On Oil. Shorting Agressively.

Oil isn`t acting right is it? It should have rallied with the strong equity market and the weak dollar and it rallied at first and than rudely reversed to close lower. It should be trading near the highs of its recent trading range, like the Euro Currency and the S&P 500 and its close to breaking out on the downside of its range. What is it telling me?

Its telling me to short and short big. Somebody is selling heavily enough to prevent oil futures from rallying on a day that the US Dollar loses 1%.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

I Am Happy I Closed Most Of My Shorts. I Can Re-Short At Higher Prices Again If I Want To.

I saw this coming. After the inability to really follow through on the downside the market snaps back sharply in pre-market. I would have been even wiser if I had reversed my shorts and went long but I have the Nikkei 225 Futures and they are trading up 90 points, in line with the move on the S&P Futures.

Nice way to start the week. This Thanksgiving week has a bullish bias to it so be careful with the short lines. I would look for some small deals in individual stocks and I will try to play the intraday noise on the S&P Futures.

Take care.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Is It Wise To Average Losing Trading Positions?

I want to add this to the last post. I kept on reading some of Larry`s material and I came across these comments made by a start up hedge fund manager regarding the best trading practices of some of the best hedge fund managers in the country:

"Some managers traded stocks, some traded bonds, some used fundamental analysis, and some simply traded throughout the day. But the only single thing the majority of them had in common was that they "scaled-in to positions". When they had conviction in a position, no matter what their style was, they bought more as price dropped.

As you likely know, in most books this is taught as a recipe for disaster. Isn't it taught never to buy more lower? Yes, it is. And who teaches this? Not the best hedge fund managers in the world. These people buy lower, and if given the opportunity, they buy even lower (I remember one 30-year veteran of the industry telling me to buy a stock he liked, and to go home and hope it drops so I could buy more at an even lower price...this man helped create wealth for some of the most successful people in the country for three decades using this exact approach)."

I do not remember of writing so much on a weekend. Its probably a good sign. I am feeling upbeat and energetic. Things have been going well for me in the last few trading sessions. Specially with the mother of all short positions that I had on in the last 3 trading sessions. I closed some, I am much lighter now.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

A Provocative Trading Thought By Larry Connors

I have been following TradingMarkets.com since its inception and I am a fan of Larry Connors and Dave Landry`s work. I was surfing the web and I found this interesting piece written by Larry Connors:

"A few days ago I got a very good email from a Daily Battle Plan subscriber asking me if the large sell-off in FXI is a reason to avoid entering the position. This gentleman's question relates to the thought that too big a sell-off could potentially be a negative sign. Based upon more than 15 years of testing, we've seen that historically, the larger the sell-off, the bigger the edge. Ideally when we're buying, we want ETFs to drop as sharply as possible before entering the position. This of course does not play out in every trade. But when you take the law of large numbers and look at many of thousands of historical set-ups, you'll see that the larger the sell-off, the greater (on average) the bounce has been."

Larry Connors is CEO and Founder of TradingMarkets.com and Connors Research. He is obviously a contrarian, just like me.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Bill Gross: Buy Utilities

The Bond King as suggested utilities stocks as a good investment in the current economic scenario:

"In buying utilities, Gross said investors would avoid "the transformational revaluation risk of equities with such a low 2% dividend return." He noted the sector is midway between its 2007 high and 2008 lows, with earnings growth shadowing the U.S. economy "as they always have, and they most importantly yield 5% to 6%," not near zero. "In a low growth environment, it seems to me that a company's stock should yield more than its less risky debt, and many utilities provide just that opportunity.""

Exelon (EXC) and Ameren (AEE) pay solid dividends and have sold off recently. Those are the names I am looking to buy. Dynegy (DYN) is a more speculative play, that has come down from its recent highs recently, correcting over 20% over the last few weeks.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Analyst Are Split On Oil Futures Direction

Crude oil futures for December delivery dropped 1.04 dollars a barrel, or 1.3%, to 76.42 a barrel in electronic trading on the NYMEx. The December contract expired last friday and the more actively traded future contract is now January contract was at $76.98.

Oil has risen 71% this year, but fell yesterday on concern the rally in commodities and equities has outpaced the prospects for economic growth. Crude oil declined for a second day in as the dollar strengthened against the euro, lowering the appeal of commodities as a currency hedge.

“What oil does next depends on U.S. equities and the dollar,” Carsten Fritsch, an analyst with Commerzbank AG in Frankfurt, said by phone. “Fundamentally, the oil price can’t be justified at current levels.”

Analysts surveyed by Bloomberg News were split over whether crude oil prices will fall or be little changed next week amid a weak dollar and ample fuel supplies. Ten of 27 analysts, or 37%, said futures will drop through November 27. Ten respondents predicted that oil will be little changed. Seven said futures will rise. Last week, 50 percent of those surveyed said prices would fall.

My oil trading system is still short and was able to profit on this recent sell off.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Decent Day. Closed Some Shorts.

I was out of the office fot most of the trading session today and I closed some of my shorts around 1086. I had a major short position and these two days really gave a boost to my trading account. I bought some Nikkei Futures near the close at 9480 for a medium to long term play. As you know I have been waiting for a decent entry point on the Nikkei Futures and I planned to buy it around 9,500.

Probably I will have to be a little patient on this trade but the Nikkei has been selling off recently and is trading at a 4 month low.

I am spending the weekend at my beach house, trying to rest a bit. I am feeling exhausted. The newborn, the trading stress and some other business commitments are draining be. But this was a great week for my trading so I am pleased.

Oil sold off again and my system has been on the right side of the market. Everything is going for me these days.

I will leave you with my favourite rapper, TI performing Whatever You Like live.

Enjoy your weekend. I will be back to my trading desk full time by monday.

Article: Japan's Nikkei index falls to 4-month low (Business Week)

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Just Arriving To My Trading Desk. Nice Surprise.

I am very pleased with this selling mode on Wall Street day as I am carrying the mother of all short lines. I was a bit nervous because I could not stand many more rallies against my big short S&P Futures position so I am feeling pretty good. I hope it sells hard into the close.

I am going to play a soccer match right after the closing bell to chill out a bit. It may turn out to be one of the top 10 trading days of the year if the sell off gathers some strength going into the close.

I will have a vintage port wine later. To celebrate a good day.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Another Non Event Session On the S&P Futures. Eyes On The Japanese Market.

It seemed almost like an holiday trading session with nothing going on. Its a bit strange that a market that had such a run up now trades quietly near the year highs. I think that the next move will be lower but I will have to watch it carefully and move fast if I have to.

I am keeping an eye on the Nikkei Futures as I am planning a medium to long term buy there. Its trading around 9600, near my pre established "buying zone". I have been gathering interesting research notes on the japanese stock market and its valuations are more than attractive. But it seems that it needs a catalyst to begin its upmove and I do not know what the catalyst might be. The august elections and the new government could of been a fine catalyst but it did not move the market at all. I like to trade the japanese market as I had some nice experiences in the past. I remember catching a move from 10,000 to 17,000 a few years ago. I wasn`t using much leverage in those days but it felt good. I am needing a similar trade now.

Read my recent post about the S&P 500 vs. the Japanese Stock Market. Very interesting indeed.

I wil be out for most of the session tomorrow. Take care.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

API Inventories Are Bullish. EIA Data Coming Later Today.

Crude oil futures are rising in the early going, moving closer to the 80 dollars a barrel mark after data from the American Petroleum Institute (API) showed a larger-than-expected drawdown in US crude oil inventories.

Nymex crude rose by around 0.50 dollars a barrel in early Wednesday trade in Asia after the API reported a 4.367-million-barrel draw in crude stocks in the week ended Nov. 13 despite lower refinery runs at 79.6% of capacity. Analysts surveyed by Dow Jones Newswires had expected crude oil stocks to drop by 600,000 barrels.

The EIA inventories will come out later today.

The market is waiting for confirmation from the second set of data, due to be released by the Department of Energy at 10:30 a.m. EST.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

S&P Holds Despite The Dollar Rally.

The S&P 500 added 0.1 percent to 1,110.32 at 4:06 p.m. in New York, its highest close since Oct. 2, 2008 despite today`s big rally in the US Dollar. I did not expect the market to hold so well into the close and print an "unch" day. Even though the market closed only 1 point higher and the Dow Jones rose in 9 of the last 10 trading sessions. I have seen other rallies end through the years and they all end like this. The last ones to buy are the individual/ retail investors that plunge in just before the permanent reversal. So, today`s session has boosted my confidence that the market is very near a sustained trend reversal.

Today’s advance brought the S&P 500 within 1 percent of recouping half the plunge that followed its October 2007 record. Remember that this is steepest rally since the 1930s. The index has jumped 64 percent from a 12-year low in March as a four-quarter contraction in the world’s largest economy ended.

One of you left the link to the Highway to the Dangerzone video clip last week. I think its appropriate for today.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Jim Chanos Is Bearish On China

Jim Chanos is bearish on China and I think he has a very good point. China suffers from huge overcapacity in every sector and their statistics are made up.

"Jim Chanos, head of investment firm Kynikos Associates and famous for his call to short Enron in 2001, has found his next big target.

Chanos and other China bears say the country has overcapacity in just about every sector of its economy, and the government's massive stimulus isn't working. They think China is simply covering things up with faulty statistics.

For example, they point to the huge reported increases in car sales in contrast to numbers showing little growth in gasoline consumption, which suggests state-run companies are buying huge numbers of cars and putting them in storage." in The Daily Crux

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

"I Look At The Board And Every Single Stock Is Up!"

"I haven't been this bearish in a year. I look at the board and every single stock is up. But there is no fundamental rooting as to why." Meredith Whitney on CNBC

Incisive as ever. She saved me a few thousand dollars with her bearish call within 1 hour to go in the trading session. I need another Meredith tomorrow.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Meredith Whitney Is Bearish As Ever

Meredith Whitney came out in her bear cape today and financials sold off to the close. Here is what he had to say:

"Bank analyst Meredith Whitney said on Monday she does not believe the U.S. equities rally is based on fundamentals, and she is as bearish as she has been this year in the stock market.

In an interview with CNBC television, Whitney said there is "no way" the banking sector is well capitalized and it is time to reduce weighting in large-cap banks. Whitney also said she sees a double-dip U.S. recession." in Reuters

It has helped a bit my shorts as the market reversed from the intradays highs and sold off a bit to the close. I can`t wait for tomorrow`s session.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Flip Flap Overnight. All In.

I covered overnight on the perceived strength and sold again short but in double. I am all in short now. This is the last "buy now or be left behind" move by fund managers.

Actually I was at a dinner party this weekend and some of my friends that had never bought stocks in their lifetime are now stock trading experts. This was the last signal I needed to act not softly but in "all in mode".

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Should We Buy The Nikkei?

Japan’s Topix index dropped to the lowest compared with the Standard & Poor’s 500 Index in five decades after the nation posted the worst stock performance of the world’s 10 biggest markets this year.

The chart shows the ratio between the Japanese benchmark and the U.S. index slipped below 0.83 for the first time since January 1999 last month. It slid to 0.82 last week, the lowest since December 1955.



Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Waiting For A Better Shorting Opportunity. Daytrading Mode.

Markets are strong in pre-market. I scaled out on Globex. Markets opened strong on Sunday`s late afternoon and the dollar went to the races early. I closed shorts and it seems I did the right thing. Its better to take a 3 to 4 point loss on the S&P Futures than a 10 or 20 loss if the market rallies today...

Oil is up over a dollar a barrel benefiting from this morning`s dollar weakness. There is too much optimist in this market this morning. I am only trading my Dax Futures daytrading system and waiting on the sidelines for any opportunity that may arise.

Anyway, for those that like a good sound, I recommend I Gotta Feeling. Inspiration and very good for getting into a good trading mood.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Oil Futures Close To A Month Low

Crude oil futures are trading close to a 1 month as worsening U.S. demand and a stronger dollar caused investors to steer clear of buying oil.

Nymex crude oil futures for December delivery settled 0.59 dollars or 0.8%, lower at $76.35 a barrel, the lowest settlement since Oct. 14.

Crude futures had floated around $80 a barrel for weeks on the promise of improved demand down the line, but the present glut of oil and fuel proved too big to ignore over the last two days. Thursday, the U.S. Energy Information Administration reported a larger-than-expected increase in oil and gasoline inventories.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

S&P 500 Gains 2% This Week

The S&P 500 gained 2.3 percent this week and on November 11 closed at its highest level since October 2008. The index has rallied 62 percent from a 12-year low in March, recovering almost half of its plunge from a record in October 2007, amid optimism that government stimulus programs and record-low interest rates are helping to drag the economy out of recession.

I am still short on the S&P Futures at an average price of 1091 and I think I will make a small fortune on this short line. Time will tell. I could not trade the Dax Daytrading System today as I was out of the office for most of the trading session.

I will leave you with a fantastic video, the Pikes Peak Hill Climb by Ari Vattanen on a Rally Peugeot. Awsome.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

More Downside Ahead. Fasten Your Seatbelts.

I am still short on the S&P Futures and my system is still short on oil, so today has been a very decent trading session by all means. The US Dollar has rallied big time and asset markets suffered a bit today but there will be much more pain ahead of us. Pain for the bulls of course as I will be sitting tight on my short lines.

Tomorrow I will have some more business presentations and I will be out of the office so my participation on the blog through the day will be very limited. Maybe Mr. Market will present me with another sell off but I sense we will have a 200 plus points down day on the Dow Jones tomorrow or in the next few trading sessions. I will ride this bear all the way down.

Oil lost over 2.5 dollars per barrel but I think the biggest downside potential is on the stock market. Retail investors are all convinced that this market will keep shooting up and they will be hurt. Total amputation without anesthetics, as my dear friend JL once said.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Bearish And Short. Is A Tag Heuer Monaco On The Way?

I am bearish and short on the S&P Futures. After a good short term bull run of 8 sessions and a test of the year highs, markets may be prone to reverse and potentially form a double top. I don`t have much time to elaborate further, as I am on a tight schedule this evening.

I did great on my daytrading efforts on the EURUSD cross. I was able to win on both sides, being long in the early morning and profiting a few pips and than reversing and catching the big afternoon upmove on the US dollar. This has been my "forte" as I am simply "going with the flow" and trying to be on the best move of the session. After all, the golden rule of trading is to let your profits run and cut your losses short.

Tomorrow and Friday I won`t be able to participate on the commenting section as often as usual because I will be out on some business presentations. The discussion was "alive and kicking" today with all members involved in trading and even in a geopolitical debate earlier in the session. This trading community is growing strongly.

I will leave you with my favourite watch, the Tag Heuer Monaco. It will mark the success of this short campaign as I will buy it if this S&P Futures short trade performs in a satisfactory way.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

The Fed Will Let The Dollar Go Down The Tubes

The FED is saying that will let the US Dollar go down the tubes, if it experiences death by a thousand cuts. Well, with comments like this we can really witness a disorderly decline:

"The dollar is under pressure in European trading hours after a top U.S. Federal Reserve official hinted that authorities won't step in to boost the buck unless its decline became "disorderly."

In a speech late Tuesday, Federal Reserve Bank of Dallas President Richard Fisher said he is aware that the Fed's current stance of keeping interest rates low for an "extended period" was denting the dollar. His comments mark the first mention from the Fed on the so-called carry trade, where investors sell currencies with low interest rates to buy higher-yielding units--a common theme in the foreign exchange markets that has already put the dollar under pressure in recent months. Fisher added that if the carry trade "were...to become a disorderly influence" he would expect authorities to "craft an appropriate remedy."

However, traders have seized upon the implication that Fed officials do not see the dollar's decline as disorderly at this point, triggering a fresh wave of dollar selling Wednesday. Dovish comments from three other Fed speakers Tuesday also supported the move." in the WSJ.com

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

API: Oil Inventories Rose Last Week

Oil prices traded near 79 dollars a barrel Wednesday morning as investors mulled rising U.S. oil inventories and a weaker dollar.

U.S. oil inventories rose last week, the American Petroleum Institute (API) said Tuesday after the markets close. Crude stocks increased 1.2 million barrels while analysts had expected a rise of 1.0 million barrels, according to a survey by Platts.

The Energy Information Administration is scheduled to release its supply data on Thursday because today is Veteran`s Day.

Oil Futures don`t seem to be able to gain any traction, up or down.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Commodities Snapshot: Gold Is Overbought

Take a look at this commodities snapshot from Bespoke. Gold seems to be the most stretched of them all.

"Oil has been trading at the top of its trading range for a few weeks now, and its uptrend remains intact. Natural gas has also made a nice move over the past couple of months, but it has struggled to make the next leg up over the past few weeks.

As investors know, gold is currently the commodity of the day, and as shown in its chart, it is currently trading right at overbought territory. Silver and platinum have rallied along with gold, but they don't quite have the relationship with the dollar that gold has, so investors haven't plowed into them as much. Corn, wheat, orange juice, and coffee have also all done well recently."

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Are We Running Out Of Oil?

Are we running out of oil?

"The IEA, they say, has been encouraged by US authorities to underplay the rate of decline in oil fields for fear of panicking the markets. The IEA's credibility is on the line here, starting with today's statement on the production outlook. A full response is required." in The Guardian

The whistle-blower says the agency has been pressured to do this by the U.S. American officials, allegedly, were afraid that the true picture of the reserves would cause panic buying, and could hit stock markets... because the world would then realize we're going to hit constraints on oil supplies much sooner than expected.

"Well the IEA in its last World Outlook forecast that oil production would not peak until the year 2030, and then it would reach 105 million barrels a day, sufficient to meet anticipated demand. The whistle-blower says many people in the agency believe that is false, that the world will struggle to pump 95 million barrels a day at best. And it will reach that peak earlier than expected. I called the agency in Paris this morning. Nobody was available to comment on the Guardian's story." in marketplace

Very interesting indeed.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Day Trading Methodology

I have been reading the latest book from Van Tharp, Super Trader and I want to highlight this passage about daytrading methodologies:

"For example, if you are a daytrader, open up a position and either take a small loss or get out at the end of the day. When you do that, you are not tied to the market all day, and you may find that you take small losses and get huge profits. Simplify your entry technique and concentrate on exits"

Now, lets cross this with Jesse Livermore remarks on the speculative line of least resistance:

"It sounds very easy to say that all you have to do is to watch the tape, establish your resistance points and be ready to trade along the line of least resistance as soon as you have determined it."

So, we have a powerful daytrading methodology in these two market generalizations. But JL added, "But in actual practice a man has to guard against many things, and most of all against himself - that is, against human nature."

Rings a bell? Maybe we should all print this post and have it by the trading desk.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Another Bearish Market Veteran: Richard Russell

Recent comments from Richard Russell of the Dow Theory Letters:

"I don’t believe most investors understand the significance of the possibility that the March to October rally was an upward correction in a bear market. The majority of analysts believe that the advance that started from the March lows represented the beginning of a new bull market. I disagree, and I’ve explained in detail why I do not believe March marked the start of a new bull market.

For the sake of argument, let’s just assume that I’m right and that what we’ve seen since March was a bear market rally. If that’s true, we’re in a very dangerous situation. It appears to me that the rally is in the process of topping out. Again, let’s assume that we’ve been in a bear market rally. If the rally is indeed topping out, then the stock market will soon be again in the grip of the bear."

Here is another market veteran that does not buy this rally. Interesting, is it not? While I am still in my thirties I am as bearish as these old guys.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Time To Short The S&P`s?

"The market does create its own psychology," Joe Clark said. "You would never go to the grocery store and pay a higher price because someone else did, but that's what happens in stocks -- the momentum that's happening today after G-20."

I have found these lines on CNN.com. I don`t have a clue who Joe Clark is, actually it resembles me of Clark Kent, but I I think he has a point there.

Markets were a bit hysterical today and rudely rallied. Remember Jim Rogers advice, "Buy Panic and Sell Hysteria"? Probably its time to short, specially if you have an intermediate term time horizon.

I will leave with one of my favourite watches brand, Breitling.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Prechter: Stocks Are Topping, Dollar Will Rally

“I think stocks are topping out, commodities are topping out and the dollar is making a bottom,” says Robert Prechter, president of Elliott Wave International and author of “Conquer the Crash“.

If the economy turns sour again in 2010, as he predicts, Prechter says the dollar will benefit as more dollar-denominated IOUs get called by creditors seeking to shore up their own balance sheets, as was the case in 2008.

A sustained rally in the dollar would have devastating consequences for stocks, emerging-market assets, high-yield debt and commodities. But gold might be the exception, because it represents ‘real money’ and more people are questioning the global paper money system, Prechter says.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Volatility On The Rise. That`s Bearish.

I found this interesting article about the rising volatility on the US stock market. I have been writing about this recently but CNBC.com wrote a good piece on the subject:

"Stock market volatility is back, a signal to some experts that the powerful rally that started in early March may be coming to an end. The Dow Jones industrial average rose or fell more than 100 points in seven of the past 12 trading days, capped by a 205-point advance on Thursday that left the index almost 53 percent higher than its closing level on March 9.

The Dow's muted 17-point gain on Friday masked the fact that it swung nearly 108 points throughout the day after the government reported the unemployment rate rose to 10.2 percent in October.

The latest volatility surge comes after a calm stretch. Over the preceding two months, there were just eight days where the daily Dow change exceeded 100 points." in CNBC.com

I consider this volatility surge as a bearish sign.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

How Are The Big Energy Stocks Doing?

I was reading an article about Exxon Mobil and I decided to check what the big energy companies were doing, how were they performing in this market. To my surprise they are a mixed bag with some big performers and a few "dogs".

The big oil caps, Exxon Mobil Corporation (XOM) and Chevron Corporation (CVX) have disappointed investors performing -2% and 3.9% in the last 12 months, comparing with a 10% surge in the broad S&P 500.

But there are some star performers in the energy sector among the big caps in names like Petroleo Brasileiro SA (PBR) surging 82% in the last 12 months and Marathon Oil Corporation (MRO) with a 16% return to shareholders.

In the energy services segment, Schlumberger Limited (SLB), Halliburton Company (HAL) and BJ Services Company (BJS) performed strongly with a 24%, 56% and 47% surge, respectively.

So, the million dollar question is, are the big energy companies undervalued and should they be accumulated on further weakness? It seems like a low risk idea.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Oil Futures Trading At 1 Week Lows

Crude oil futures traded at a 1 week low Friday after the U.S. unemployment rate rose to 10.2%, a 26-year high.

The December Futures settled 2.19 dollars, or 2.8%, lower at 77.43 a barrel on NYMEx. This was the lowest settlement since October 30.

Continued high unemployment in the U.S. could curb discretionary spending, dragging on gasoline and diesel demand.

Oil joined a general fall in prices across most of the commodity spectrum, as investors took flight from riskier assets and back into the US dollar, which strengthened against the euro.

My oil trading system is short on the December Oil Futures.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

S&P Above 50 Day Moving Average. Financials Weaker.

"With the S&P 500 moving back above its 50-day moving average, the percentage of stocks in the index above their 50-days is unsurprisingly back above 50% -- 51% to be exact. But there are still a few sectors that have failed to get this 50-day indicator back above 50%. The Financial sector ranks the worst with just 29% of stocks above their 50-days." in BIG

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

US Stock Market Rallies On Economic Data.

The Dow Jones Industrial Average rose the most since July after U.S. jobless claims and productivity beat economists’ estimates.

Art Hogan, the chief market analyst at New York-based Jefferies & Co.commented today`s data, “We look at the initial jobless claims as another piece of economic data we’re pretty happy with.”

Crude oil futures for December delivery fell 78 cents per barrel, or 1%, to 79.62 dollars a barrel in a dull trading session.

I did a few trades on my Dax Futures trading system and I was able to go onboard the afternoon rally but I had a few bad signals early in the european trading session. All in all, I was only able to grab 8 points out of the Dax. Not very impressive but helps paying the bills.

I played some soccer late in the afternoon and I am feeling pretty relaxed. I will leave you with one of my favourite Yogi Berra quotes, "Baseball is 90 percent mental. The other half is physical." I also love this one, "You can observe a lot by just watching."

Have a good trading day and don`t forget that we will have the Employment Report at 8.30pm ET. I think the report will be bullish but I am unsure of the markets reaction. I will have to be focused, alert, so I will have a good night`s sleep.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Marc Faber`s Bullish Call On The US Dollar

Dr. Doom is a long term bear on the US Dollar but he is antecipating a very tradable rebound on the greenback:

“Maybe the dollar has made a turn, it can easily rebound by 10 percent. It may have started already since the asset markets started to go down 10 days ago.”

One thing is for sure, volatility is increasing and we will have some spicy days on the forex markets. Probably the best way to play it is just go with the flow.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Back To The S&P Futures. Shorted After The Fed.

I shorted the market for an intraday play after the FED meeting. Having shorted at 1053 I was out of the money for most of the time but in the last half hour markets really sold off and I was able to net 12 points. It was a good play but I will be back to my systematic Dax Futures trading tomorrow and leave this S&P plays to those very rare occasions where I feel that I cannot lose, or at least the perceived risk/reward analysis is definitely in my favor.

It felt good to be back to the S&P`s, though.

Volatility will pick up again tomorrow and rise to a climax on friday with the jobs report.

It was a CL night again and I will leave you with this evening most beautiful goal. A magnificent strike from Babel.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

What Kind Of Trader Are You?

I am a fan of Van Tharp`s work. I came across his work about 10 years ago when I first read "The Markets Wizards" and his interview was one of my favourites alongside Ed Seykota`s and Richard Dennis`s.

Last week I ordered his new book, Super Trader and I am starting to read it now.

And on the first section I have found an interesting test that every trader should do. You should spend a few minutes answering a questionnaire and you will find out what type of trader you are and what you need to do to be successful. You can do the test here, www.tharptradertest.com. It will take about 5 minutes.

I already did it. My trader type is "Strategic Trader".

According to Van Tharp, a "Strategic Trader" is a type of trader that has a great chance of success but is (a) likely not to recognize emotional mistakes, (b) lean toward perfectionism and, (c) have a strong desire to be right. Quite interesting, not?

Please post your trade type on the comments section after doing the test.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Art Cashin`s Critical S&P 500 Levels

“I think it will be dangerous if we break 1,030 or 1,025 on the S&P, that may call for a further leg down. It’s time to be nimble and be very cautious.” Art Cashin

The S&P 500 is now down about 5% since October 19th, and the index is trading below its 50-day moving average.

Pre-market is negative and I expect another volatile session for today. European markets are trading lower over 1%.

So, I will end with one of my favourite JL, stock market quotes:

"I couldn`t afford anything that kept me from feeling physically or mentally fit. Even know I am usually in bed by ten. As a young man I never kept late hours, because I couldn`t do business properly on insufficient sleep."

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Oil Futures Rise On ISM Index Strength.

The price of oil has risen more than 1 dollar a barrel after strong manufacturing data from the US increased optimism about the global economic recovery. NYMEX light crude futures rose 1.13 dollars a barrel to end Monday trading at 78.13 USD.

The gains came after a report said US manufacturing output rose again in October for a third successive month, beating expectations. The rise was not enough to trigger a reversal on my oil trading system.

I will leave you with an amazing music video, Bush - Superman (Live). Pure rock from UK.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Best Jesse Livermore`s Stock Market Quotes (1)

“There is the plain fool, who does the wrong thing at all times everywhere, but there is the wall street fool, who thinks he must trade all the time”

In a book full of trading wisdom its difficult to pick the best lines. I will be posting some of my favourites from the best stock trader of all time, JL.

Getting ready to start my trading session.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

Saudi Arabia Abandons WTI Crude Oil

Saudi Arabia has decided last week to abandon its long alliance with West Texas Intermediate crude – the famous oil used by most global producers to price their exports to the US. It is both a technical issue and a symbolic shift that strikes a blow to the dominance of the New York Mercantile Exchange (NYMEX), the world's biggest oil trading bourse.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.

What To Expect From Monday`s Trading Session?

How will the trading week begin on Monday? The guys over Bespoke website have gone through some old archives and came up with this statistics:

"What an ugly day. Today marked the 142nd time since 1900 that the Dow went down at least 2% on a Friday (when the following Monday was not a holiday). On the following Monday, the Dow has averaged a decline of 0.31%, with positive returns 49% of the time. Since the bear market that started in October 2007, this has happened 6 other times (see table at right). On the following Monday, the Dow has gone down 4 out of 6 times for an average decline of 0.73%. The last two times we've had a >2% decline on Friday, the following Monday has lost 2.42% and 2.63%."

The rally is risk is either in a pause or over. I am looking forward to tomorrow morning as this increased volatility greatly enhances my profitability.

Oil Trader`s Blog is a trading community for active online futures and stock traders. We provide our real time trading decisions and our market analysis on this website.