Oil : Oversold Indicators

L

louisjxn

I'm relatively new to trading, but I would like to start tracking the price of oil futures in order to understand when they are overbought and oversold. I have been trying to use the bollinger bands, RSI, etc on the CLH16 March futures. Can anyone tell me if there is a more effective way to do this, or if I am on the right track using these indicators?
Thanks for any feedback
 
you guys do know that most of the frackers longer-term hedges are expiring as we speak right? There has not been any activity regarding setting up new hedges as of now in either direction so we are running straight production prices to contract sparking front month and 1st and 2nd month futures spreads to converge and dive in unison
 
louisjxn said:
I'm relatively new to trading, but I would like to start tracking the price of oil futures in order to understand when they are overbought and oversold. I have been trying to use the bollinger bands, RSI, etc on the CLH16 March futures. Can anyone tell me if there is a more effective way to do this, or if I am on the right track using these indicators?
Thanks for any feedback
More...

This might help you: the weekly rig count http://www.wtrg.com/rotaryrigs.html
and the weekly oil supply http://www.eia.gov/dnav/pet/pet_stoc_wstk_dcu_nus_w.htm
 
CL futures is inappropriate for the inexperienced. (well, most all futures are actually)

Geopolitical risks, contango, market manipulation, volatility, leverage are a recipe for disaster for the naive.

If you are serious about learning to trade, start with longer term "Swing" and as you become more adept, then and only then slowly lower your time frames. Stay away from CL, GC and focus more on Index's, SPY or QQQ are a good place to start.

And as an FYI Oscillators, Bands, RSI, Stocks, MACD, etc... aren't going to give you an edge...

Anything else and you just become another "feeder fish"
feeder fish.jpg
 
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louisjxn said:
I'm relatively new to trading, but I would like to start tracking the price of oil futures in order to understand when they are overbought and oversold. I have been trying to use the bollinger bands, RSI, etc on the CLH16 March futures. Can anyone tell me if there is a more effective way to do this, or if I am on the right track using these indicators?
Thanks for any feedback
More...

Indicators should be used by more experienced traders to help ease trading, but I don't recommend people starting out to use them. Get good chart book and learn price structure first, this should take you couple years, when you learn patterns, you want to also learn when not to take patterns, you practice, take notes, slowly make a trading plan, run you trading like a business, don't open an account until you have answers before questions, in other words, when structure happens you know like breathing what you should do. Money management is more important than getting in, how you try to control the risk so the risk does not control you.

After few years you can add couple moving averages and eventually Bollinger Bands, but unless you can know what is happening without the indicators, learning will take many more years by starting out with indicators. You want to be able to know what price is doing to cause the indicator to move in one direction or other.

No such thing as words like overbought or oversold, you can go into poorhouse by thinking this way. CNBC uses them but as a trader, until something gets to zero, nothing is oversold.

Good luck.
 
Handle123 said:
Indicators should be used by more experienced traders to help ease trading, but I don't recommend people starting out to use them. Get good chart book and learn price structure first, this should take you couple years, when you learn patterns, you want to also learn when not to take patterns, you practice, take notes, slowly make a trading plan, run you trading like a business, don't open an account until you have answers before questions, in other words, when structure happens you know like breathing what you should do. Money management is more important than getting in, how you try to control the risk so the risk does not control you.

After few years you can add couple moving averages and eventually Bollinger Bands, but unless you can know what is happening without the indicators, learning will take many more years by starting out with indicators. You want to be able to know what price is doing to cause the indicator to move in one direction or other.

No such thing as words like overbought or oversold, you can go into poorhouse by thinking this way. CNBC uses them but as a trader, until something gets to zero, nothing is oversold.

Good luck.
More...

Now come on don't be so stupid - no one with any sense will use indicators.
 
Mysteron said:
Now come on don't be so stupid - no one with any sense will use indicators.
More...

Oh come on don't be SO stupid - no one with any sense will not use indicators.
Some people know how to use them and many others don't. What do you use? Flipping a coin?
 
NoBias said:
CL futures is inappropriate for the inexperienced. (well, most all futures are actually)

Geopolitical risks, contango, market manipulation, volatility, leverage are a recipe for disaster for the naive.

If you are serious about learning to trade, start with longer term "Swing" and as you become more adept, then and only then slowly lower your time frames. Stay away from CL, GC and focus more on Index's, SPY or QQQ are a good place to start.

And as an FYI Oscillators, Bands, RSI, Stocks, MACD, etc... aren't going to give you an edge...

Anything else and you just become another "feeder fish"
View attachment 161825
More...

I was with you right up to the point you said swing trading is better then scalping, then I got off the train fast! I don't know how long you been swing trading, but I can tell you right now the market is too volatile to swing trade, Nothing is as it was 3 years ago or longer. The only way you can swing trade this market is if you have a large amount of money to move around the board. You ether take a positions in the morning and get out at the end of the trading day or scalp. When I first got into trading I make a good living swing trading, now I wouldn't swing trade on a sim account with paper money. The HFT have learn how to go after hedge funds and swing trader's account. don't thing they are going after intro day traders only anymore, that's old news. the big money now is hitting hedge funds and swing trading stops just after or before the market opens. IMO
 
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