Author: Curt Melonopoly
How to Swing Trade Crude Oil: The Next Leg Has Started, Will it Last? Our Oil Trading Strategy (Part 1 of 3)
Swing Trading Crude Oil – Next Leg of the Rally Has Started. A Review of Our Strategy.
Since crude oil traded to negative prices, we have been writing a series of articles for our subscribers (some are unlocked for the public) – they are below. This is a continuation of the article series for the current price rally.
Trading crude oil is difficult enough, the technical analysis we will review here (including price resistance, support, retracement levels, time cycles, symmetry) and various other topics such as; Surprise Jobs Numbers, Fed stimulus, Corona Virus, OPEC and more.
The technical analysis for the legs of the rally have been spot on (as of time of writing the public can refer to the first 3 unlocked articles below on Apr 29, Apr 30 and May 2 – eventually they will be all unlocked), the trick is trading it.
- May 29 – Protected: How to Trade Crude Oil – Recent Rally, Time Cycle, My Current Oil Swing Trade (Premium) $CL_F $USO $USOIL
- May 20 – Protected: How to Trade Current Price Decisions in Crude Oil (Premium) $CL_F $USO $USOIL
- May 19 – Protected: Oil Trading Newsletter (Premium): Charting, Alerts, Price Targets, Trading Strategies, Time Cycles. $CL_F $USO $USOIL
- May 15 – Protected: What’s Next? Crude Oil Trading Strategy – Trading Trend Line Resistance Break-Outs (PREMIUM) #CrudeOil #OOTT $CL_F $USO
- May 4 – Protected: The Symmetry and Time Cycle Price Targets of Next Move in Oil Trade | Part 4 (Premium) How We Daytrade Crude Oil.
- May 2 – BOOOM! Price and Time Exactly as Predicted Days in Advance | Part 3 – How We Daytrade Crude Oil #OOTT $CL_F $USOIL $WTI $USO
- April 30 – “Excuse Me, While I Kiss The Sky”. Part 2 Insider’s Look at How We Daytrade Crude Oil (w/ real-time alert screen shots from oil trading room).
- April 29 – What They Won’t Tell You – How We DayTrade Crude Oil Against The AI’s in the Markets, A Sneak Peak.
In the most recent article on May 29 I was clear that I was starting to short the rally in advance of the key resistance in the 38.57 area on FX USOIL WTI and that doing so was not an easy trade and that if the rally continued in to the next leg that I would reverse the trade – this happened Friday morning.
From May 29:
The big challenge with this oil trade strategy is that I am trading against the wider trend, the trend is up and I am trying to position ahead of the turn down in oil, this is not a simple strategy to execute.
In the oil trading room and on the oil trade alerts feed Thursday / Friday I also had said that I was going to trade the rest of the decisions along with EPIC because I could see the decision coming.
Commentary from Oil Trading Chat Room and Oil Trade Alerts (there is also a live trading room with voice alerts and charting separate of this).
As the price of oil was nearing the key resistance area of the charting in this leg of trade EPIC software (as was I) was shorting the resistance. I was noting that a reversal trade was likely imminent.
Curt MelonopolyYesterday at 8:16 AM
EPIC is shorting 38.56 and will likely reverse above, booting up trading room.
And then when price breached the resistance area we reversed our short trade 3/30 size to 12/30 size long for the next leg of trade. Oil rallied on the day from there more than 100 points.
Reversal trades are tough, this morning I (and various EPIC V3 programs) reversed at 38.50-.70 an oil short 3/30 size for 12/30 size longs for a rocket ride🚀 Hit 39.65 on FX USOIL WTI trading 39.44. Wild day. We'll see what next brings.#OOTT $CL_F $USO #swingtrading #crudeoil pic.twitter.com/L9VpJkyQAG
— Melonopoly (@curtmelonopoly) June 5, 2020
Curt MelonopolyYesterday at 8:40 AM
On the oil swing EPIC did reverse 12 contracts from 3 short released 4 so far trading 39.19, we’re in live room. Will release P&L as we go here so you can see what it is doing. 38.56 is the mark for sure for reversals.
Oil Trading Room Chat Screen Capture.
Strategy, Time Cycles, The Fed, The Virus.
The image below provides an idea of what our oil trading alerts feed looks like as trade progresses.
The strategy for swing trading the oil price rally was long until key resistance areas are near as with what occurred on Friday. The other important part of this current area of the rally is that there was a mid time cycle for volatility occurring around the week of June 3 so we were being extra cautious with our long bias.
The mid time cycle would be an opportune time for oil to reverse in the rally, however, the Fed has once again brought in stimulus, continues to signal all kinds of magic money and signals the possibility of more, the world is re-opening after the initial COVID scare, a surprise jobs number was posted Friday and Trump is talking up virus vaccines ready which is almost guaranteed to have the rally continue.
This will all be on close watch however this week because quite often Fed stimulus, magic money talk, news flow in general is timed perfectly within market cycles (they are not stupid) and this can unwind fast, so we will be vigilant being long in this current leg of the rally – to say the least.
So What is the Plan for the Next Part of the Trading Strategy?
Some of the questions an oil trader needs to consider in planning for the week coming;:
- Where is key resistance and support?
- How to size at key resistance and support?
- When to reverse the trade if it support is broken or resistance is breached?
- When to add to the trade or trim the trade?
- Key areas to trim size within each structure or range – position trading.
Lets Start With The Primary Simple Structure of the Oil Chart Trend Lines (for Part 1 public facing article).
Then in Part 2 for our Swing Trading and Oil Trade Subscribers we will go in to Swing Trading the Time Cycle Charts and Models (helps swing trade and position key areas of support and resistance, time and symmetry decisions which is key for sizing adds and trimming positions).
Then in Part 3 for our Pro Oil Day Traders (Oil Trade Subscribers) we will review the various EPIC Oil Algorithm Chart Models for Day Trading and Swing Trading decisions on a variety of time frames.
Part 1 – Simple Oil Charts for Swing Trade Strategies
The oil chart below is from 11:14:37 AM Thursday, crude oil was just holding on to the support of both the trading box of the “gap” on the one hour chart and the lower uptrending support.
And then Friday morning the surprise jobs number came out and oil rallied again to the top of the resistance on the simple trend line crude oil swing trading chart.
Shown below is the Simple Crude Oil Chart for the Gap and Trend lines.
So what is the Plan for a Simple Swing Trading Strategy for Crude Oil here?
You should be long at the key support areas of the chart, the horizontal trend lines that make up the “gaps” historically on the 60 minute chart and more importantly at the up trending trend lines which oil traders are obviously using to size their trades.
At end of week trade on Friday oil price was left at the resistance area of the upper trend line with another possible upper uptrend trend line and trading box “gap” resistance above.
If oil fails to hold support or breaches the resistance areas of this chart you will need a plan – this we will cover in Part 2 and Part 3 of this article.
Below are some simple tips;
If oil breaches resistance look to the next resistance in your strategy and be sure that you are aware of how break-outs work paying close attention to previous resistance now support levels.
If oil fails support be sure you don’t get chopped up by death of a thousand cuts around the key support (in and out of trade taking small losses that add up) and you will need a plan for this also.
Knowing the order flow of intra day trade helps a lot (along with various other more technical indications which increase probability that you are on the right side of a move) which is why we have the oil machine trading software side of our business that our oil trading room and alert clients are alerted to. You can find the most recent EPIC white paper here: EPIC V3.1.1 Crude Oil Machine Trade Software Update | June 4, 2020 White Paper #OOTT $CL_F $USO $USOIL.
In Part Two, “Protected: Part 2 of 3 – Swing Trading Crude Oil: Key Chart Considerations (Time Cycles, Symmetry, Support and Resistance Levels for Sizing)” we will look at more charting and strategies for our Swing Trading and Oil Trade Subscribers including time cycles, other chart time-frames, symmetry, support and resistance, sizing and more.
In Part Three, “Protected: Part 3 – Algorithmic Crude Oil Trading Strategies (Day Trading, Swing Trading, Position Trading, Time Frames, Models)” for our Pro Oil Day Traders (Oil Trade Subscribers) we will review the various EPIC Oil Algorithm Chart Models for Day Trading and Swing Trading decisions on a variety of time frames.
As always, any questions please send me a note via email [email protected].
Thank you.
Curt
Further Learning:
If you would like to learn more, click here and visit our Crude Oil Trading Academy page for complimentary oil trading knowledge – posts from our top crude oil traders that includes learning systems, blog posts and videos.
Welcome to NYMEX WTI Light Sweet Crude Oil Futures.
Subscribe to Oil Trading Platform:
Standalone Oil Algorithm Newsletter (Member Charting Reports sent out weekly at times in report form or updated on email regularly).
Real-Time Oil Trading Alerts (Private Twitter feed and Discord Private Server Chat Room).
Oil Trading Room Bundle (includes Weekly Newsletter, Trading Room, Charting and real-time Trading Alerts on Twitter and private Discord Chat Room Server).
Commercial / Institutional Multi User License (for professional trading groups).
One-on-One Trade Coaching (Via Skype or in person).
Article Topics; How to, Swing Trade, Crude Oil, Oil Trading Strategy
EPIC V3.1.1 Crude Oil Machine Trade Software Update | June 4, 2020 White Paper #OOTT $CL_F $USO $USOIL
EPIC V3.1.1 Crude Oil Machine Trading Software Code Upgrade Details | White Paper Update
June 4, 2020
EPIC crude oil machine trading software is a proprietary software development project with an aim to trade crude oil futures. Historical reference can be found at the linked documents below.
Click here for the original white paper drafts for EPIC V3 Crude Oil Machine Trade Software.
Click here for the most recent update to white for EPIC V3 Crude Oil Machine Trading Software.
Below is a white paper update ispecific to EPIC V3.1.1 software coding update completed for live trade use commencing June 1, 2020.
Purpose of Software Update
EPIC V3.1.1 updates were completed post COVID-19 Black Swan Event for two reasons;
- The trading range and crude oil volatility has increased, the software was updated to allow for a wider range of trade on larger time frames and more volatility.
- Limit risk via larger account size requirements (CL futures) and / or utilize CFD accounts.
Impact to Software
The software now runs with adjusted trade size weighted to larger time frames such as hourly and two hour charting vs. 30 minute charting.
The coding is structurally identical with the exception that larger time frames are given more weight allowing for price action seen post COVID Black Swan.
The software can also run on a CFD platform (as well as CL futures).
Remedy of Risk
Having software coded to larger time frames and increased volatility allows for the software to considerably limit risk, essentially the arena of play got larger.
For a trader following along with alerts, trading CFD’s allows a trader to engage the trade sizing EPIC is firing trades to with a much smaller account considering the software is firing on a 30 account size protocol (300,000.00 USD).
Projected Returns
The V3.1.1 software trials (private) ran at a return (annualized) of 48.9% over a 60 day period. As of June 1, 2020 the software went live on our live trading alert feeds and the results will be regularly made public. Articles will also regularly be written and released to explain the results and team development initiatives as we progress. .
Business Inquiries.
For information about oil trade alerts, oil trading room and oil trade reporting contact Compound Trading Group at [email protected].
For information about automated machine trading platforms contact our agent representative Richard Regan as follows:
CONTACT
Email [email protected]
Phone 1-849-861-0697
Follow
Others in this document series can be found here:
- December 10, 2023: EPIC Update: v6.1.1 Machine Learning Trade Software – Final Protocol Real World Results
- June 3, 2023: EPIC v4.1.1 Crude Oil Machine Trade Software White Paper | June 3, 2023
- March 28, 2022: EPIC v3.3 Crude Oil Machine Trade Software White Paper | March 28, 2022 Update
- January 7, 2021: EPIC v3.1.5 Crude Oil Machine Trade Software White Paper | Updated January 11, 2022 w/ Trade Execution Data
- June 4, 2020: EPIC V3.1.1 Crude Oil Machine Trade Software Update | June 4, 2020 White Paper #OOTT $CL_F $USO $USOIL
- April 19, 2020: EPIC V3.1 Crude Oil Machine Trade Software Update Details | White Paper #OOTT $CL_F $USO $USOIL
- December 29, 2019: How EPIC v3 Crude Oil Machine Trading Outperforms Conventional Trading
Article Topics; Crude, Oil, Trading, Algorithm, Machine Trading, DayTrading, Futures, EPIC, Trade Alerts, Oil Trading Room, $CL_F, $USO, $USOIL
Service Platform Updates: New Trading Week, Lot More New Coming. Current Trades, Alerts, Sunday Webinar, Trader’s Conference, Trading Room, New Location etc
Good afternoon traders,
Hope you had a great weekend.
I spent the majority of the weekend in Study and getting settled in our new location.
The US riots, the virus, the sell off then snap back and now time cycle inflection are big for traders, we’ve done well but it does require significant study to continue in it.
The new location (as has been with others recent) is a reaction to the virus lock down. Since the lock down we have been negotiating with folks and working with various people that provide infrastructure and as opportunities have led us closer and closer to the best possible location on the island I have moved. Anyway, after 4 moves we’re finally at the final goal destination.
So this week is an inflection week, a big week for us in many ways.
Settling in to a semi-permanent location will be good and will allow us to focus on bringing to conclusion many things we are working on.
Being a start up (yes 5 years in we are still a start up haha) that is boot strapped grass roots style I’ve done my best to keep you in the loop, we get many questions through-out each week so I try to summarize Q and A in these updates. Thank you again for your support and patience.
The location moves on each occasion require a tonne of work (primarily infrastructure to operate) so I appreciate your supporting us. If we weren’t in the kind of development we are in we could just have been in any location, but there are many reasons why we are not in western society for the development and many reasons while we are over seas that our location is critical. That is a long story, but that is the bottom line.
So we’re managing a massive development initiative with a small team in locations that require a lot of negotiation and infrastructure type work and patience.
Anyway, now that we are in our ultimate location that has everything we need, here is what our inflection week will bring (and I know I’ve been promising some of these things and this is the week they’ll roll out). Bottom line is that this week is WIP clean up and below are some of the things we are cleaning up on our work in progress:
- The new location will not be set up perfectly for about a week, we have internet (high speed) but we will experience about or up to 8 restarts of our software and or trading room a day until the final fiber line is run to our location (it is being run from about 2 miles away and they’re working on it now). When complete we will have that fiber line and satellite and cellular back up. Right now we have all that but it is not done the way we need. The back up generators here are world class and security is top notch as are the amenities for the upcoming trader’s conference.So until the final install you can expect interim outages in the live trading room and this will also affect the Sunday Swing $STUDY sessions. Anytime it goes down we’ll simply reboot and restart, it can be up to 5 minutes on each occasion.
Video of new ocean side trading crib and location of our upcoming traders conference as promised 🌊🌴 pic.twitter.com/HPRX2TCQmi
— Melonopoly (@curtmelonopoly) May 30, 2020
- There is an announcement on deck as I’ve noted previous (next in the queue) about EPIC software. It is next and will be within 24 hours – new white paper. Bottom line is we have completed the software and the real world test will start, it will be very public along with mainstream articles etc. More on that soon. And I know I’ve said it recently a few times, but you can expect very active EPIC oil trading alerts going forward. This is a big deal because it will basically be EPIC’s world premier and the live trading results will be very public going forward. The next is the trader’s platform that is now in play with our team and hopefully complete before end of year. Again, more on this in formal announcement on deck.
- I am personally in an oil trade that I am a tad underwater on and tonight I will be sharing charting as trade sets up for the week describing my trading plan as it unfolds. Fortunately my size is right and I do have a plan, I’ve shared a lot on this trade so I’m sure you know were I’m going with it.
- My oil trade is a time cycle inflection trade that I’ve discussed in some detail here (market inflections) and this and other articles Protected: TIME CYCLE INFLECTION: How to Swing Trade It. Volatility, $VIX, $VXX, $OVX, SP500, $SPY, Bitcoin, $BTC, Oil, $CL_F, $USO, Gold, $GLD, Silver, $SLV, US Dollar, $DXY and on recent Swing Trade $STUDY Webinar videos.
- The profit and loss statements will be out this week, again, my apologies but they do require significant hands on personal time to reconcile considering all of our different accounts.Bottom line is we’re doing better and better all the time with our swing trading newsletter and swing trade alert platform, our returns are parabolic at this point (I don’t think we’ll ever see less than 400% per year ever again) primarily because of a proven process that allows us to really harvest ROI on the winners and on the laggards we’re small in size so they’re not weighing us too heavy at all. As rotation happens we trim our trees for profit. The process works well. There is a sizing and trade positioning article here that I will be continuing in with other parts of the article in near future. Also in development is the coding of 200 equities from our swing trade platform to machine trading along with SPY, VIX, GOLD, SILVER, BTC and US DOLLAR. This is also scheduled for completion late 2020 but realistically not totally complete for 2 years.
- The day trade alerts platform on private twitter alert feed is re-launching as noted previous and I would expect within 2 weeks it will be in full flight. I’m slowly bringing swing structured models down to a day trade time frame, but the market has to come to us on it, when we get the extreme highs or low inflections this is where you’ll see it light right up. Currently we aren’t re billing any subs as the platform is in start up, so the time period is essentially free for anyone currently subscribed. Billing will start when we’re settled in and running smooth. Bottom line with the day trade alerts feed is that early in our 5 year journey I spent 2 years day trading live and we did exceptionally well so I brought the program back to garner more ROI now that our swing trade platform has been built out.
- The shout outs many of you have provided us recently really help our team stay motivated, thank you for doing that. I manage a small 4 person team and they are young, it really lifts their spirits. They’re managing a massive work load and sometimes they need the boost, so thank you. And truth be told, with the soon to be released main stream media articles on deck, your shout outs will really help us there because many of our competitors will be trying to knock us in the public eye, this is par for the course and expected.
- The weekly Swing Trade $STUDY videos will be out Sunday night and may not include a formal written report this week, so don’t rely on the actual report. Last week we did a significant video and written reporting session that we sent out in about 6 parts of written reports so those charts and set ups are likely still in play as is, the videos from the study session webinar tonight will likely be more focused on how to manage those set ups (and some new) in light of the time cycle inflection and how to trade the inflection properly.
most ideal scenario this week, we sell off and buy fear
covid sell off and bounce rocked
moar!
— Melonopoly (@curtmelonopoly) May 31, 2020
Any others you want me to look at message/email me please.
Tonight Swing Trade $STUDY Webinar we're working Current Trades, Time Cycles, Anarchy Stocks, Pot Stocks, Gold Stocks, Semis, Volatility, VIX, SPY, GOLD, SILVER, US DOLLAR, BITCOIN, Oil….#swingtrading
— Melonopoly (@curtmelonopoly) May 31, 2020
- And finally when we get settled in here over the next week I am going to personally take 90 days to focus on writing two articles per day (short) with videos to explain what I’ve learned in oil trading, swing trading and daytrading to summarize my journey. I’ve been meaning to do this for some time but without the ideal location to focus in this has been difficult until now. So now the opportunity has presented and I will be taking advantage of that. I have documented much of it in articles and on our Compound Trading Group YouTube Trading Video Channel but mostly with raw trading room video feed coverage so it is cumbersome and not easy for traders to digest in 10 minute bite sizes or less. So that’s the goal, about 150 articles with videos that traders can consume in 10 minutes or less for each trade set up learning.
Anything else I can do please let me know!
Thanks
Curt
It’s Hard to Be Patient, But Here’s How It Generally Works – A Quick Note About Time Cycles and Trading Process
Hello traders,
A quick note for newer traders and a good reminder for even the more experienced.
The markets have an ebb and flow (time cycles) and successful traders have trading processes that provide their edge.
When markets are at an inflection (picture the water on the beach coming in and out), the inflection is when the water is turning. Now, picture an aggressive ocean, the foam on the beach etc… this is the markets. Different ebbs and flows are critical.
But what is more critical is perspective, patience and being attentive to the current conditions.
I see traders (and I have made this mistake) that sign on to an alert feed (as an example) and depending on timing (their timing within market cycles) can get frustrated. This is a mistake.
Right now we are in an inflection. Signing on to ANY platform ANYWHERE right now, everyone is in an inflection. It can be bad for some, choppy for others and for others a $STUDY and positioning time. You’ll find the more experienced traders are slowly positioning and getting ready for the next cycle. This is not a time where you will find optimum return, however, that time is near again. See our articles lately about time cycles or attend the Weekly Swing Trade Study sessions.
You need to look at your trading from a wider perspective than a month, you need to see it as cycles, these cycles can be months in duration.
Some cycles are better than others, they all have their own nature and nobody knows in advance exactly what that will look like.
If you study our Swing Trading feed you will find we $STUDY and prep and chew at the edges of plays getting positioning over and over and then BOOM BOOM BOOM BOOM BOOM etc…
And then back to $STUDY, prep, chew at the edges and that is at least 90% of the work and time. The winning when it comes is fast and furious. But you have to be ready, you have to do your homework, you have to have perspective and you have to have patience.
Our most recent returns, last 12 months have gone parabolic and the P&L I will finally release this weekend, it’s been busy for us to say the least.
We just got in to the ultimate location this week that I will be sharing with you soon, we have big news with EPIC Oil Machine Trading on deck, we’re managing a massive swing trade platform (we have upwards 40 trade in play at any given time and our profit runners on top of that), the Weekly Swing Study Sessions and a new Day Trade Alert feed that will get up and rocking soon (which is a great example, that takes time because the cycle has to come our way and when it does the feed will be in full swing, the set ups have to come to us we can’t force them).
Anyway, I’m trying to give some of the newer traders some perspective, we’re nearing 1000% returns in swing now (you’ll see on the P&L’s) and I don’t think we’ll ever see less than 400% per annum now, our process is really tight on the swing trade platform – BUT you have to understand most of those returns are in what we do when we are not winning which is about 90% of the time. Perspective is critical. Think duck hunting, you sit in the weeds and then BOOM BOOM BOOM. That is swing trading.
you have to understand most of those returns are in what we do when we are not winning
The oil trading different story, that is a different constant ebb and flow and you can see the most recent time cycles (legs of trade) clearly in the recent string of articles I’ve been writing about this move in oil. And then machine trading different yet.
And in day trading, that alerts feed will take time to get flight properly, but the next up cycle it will be golden and it will be golden from there forward (we have to bring all our swing chart models down to a day trade time frame but the market has to be ready for us too, the cycle).
More experienced traders know all this, but it is a good reminder nonetheless.
If you find you’re being impatient it is because you are not preparing for the next, it’s that simple. If you’re thinking right as a trader the down time is the busiest time you will have – in preparation for the next.
If you have any questions send me a note any time.
Curt