3 Scalping Strategies for WTI Crude Oil

As already indicated, the price of oil can fluctuate because of various factors, including political situations in key producing countries. Notwithstanding, there is the possibility of getting something out of the market from these little price changes. Aside from day trading, you can implement other strategies such as scalping, news trading, and price chart analysis for better options when crude oil trading. Nevertheless, we never encourage any trader to trade oil stock on a long-term basis since its value and prices change constantly. Therefore, a short-term trading strategy, such as scalping or day trading might be the best option for traders. With this, it can be easier to analyze the trends of the market and predict the future movement of price.

Is Sony doing anything about scalpers?

In an attempt to combat those issues, Sony Japan has started issuing anti-scalping stickers to vendors in that country. The way it works is simple: the sticker is applied to the outside of the Playstation 5 box, and when someone buys the console, the sticker is cut — marking the product as “sold.”

The economic calendar is therefore a very valuable tool to use. Remember that there are traders who have achieved a lot of success in trading news. Ideally, you need to have a technical analysis method that you have back-tested for a long time. If you have this, your process of making money will be a walk in the park.

A CCI reading above the +100 level will ensure a higher probability of the trade to succeed. The second technical indicator we’re going to use to spot cycles in the commodity market is the CCI indicator. For cyclical traders, this is often the best opportunity to enter the market. Daniels orbex review Trading is division of StoneX Financial Inc. located in the heart of Chicago’s financial district. Established by renowned commodity trader Andy Daniels in 1995, Daniels Trading was built on a culture of trust committed to a mission of Independence, Objectivity and Reliability.

Under long-term contracts directly between the oil producer and oil consumer. Get tight spreads, no hidden fees, access to 12,000 instruments and more. Get tight spreads, no hidden fees and access to 10,000+ instruments. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate.

Enjoy reliable, multilingual support during business hours via chat, email, or direct phone calls to your personal account manager. AvaTrade is regulated in multiple jurisdictions around the world, which makes the company a reliable, trustworthy, and transparent brokerage services provider. Some of the major global indices that are ideal for scalping include the FTSE 100, S&P 500, DAX, and DJIA. No Rollover or Swap Fees – There are no other extra charges apart from spreads because no trade is left running overnight. Once you create and test your strategy, you will be good to go.

However, your strategy must be holistic, in the sense that it combines the various forms of analysis – technical, fundamental, and sentimental. Furthermore, you should test and retest your strategy until you have a higher success rate. Oil investment comes with different benefits but getting prepared is essential. There are various ways to trade the oil market; here are a few ways to do that.

When you invest in oil, there are two major focal points – supply and demand. Investors should consider supply and demand irrespective of the tensions in the Middle East, press releases, or news events in the market. To break it down in a simple fashion, we will look at how each focal point influences oil price when trading. Today, with the increasing consumption of recreational and agricultural products, the need for crude is also on the rise with high pressure. The high demand contributes to its extreme liquidity and high volume.

Wars, trade agreements, regulations, and other political events can all directly affect the price of crude oil. Our team at Trading Strategy Guides has developed the Crude oil trading strategies PDF. It is no secret that the Crude Oil market is dominated by commercial players and big hedge funds. That is why we designed this strategy to help you swim with the big sharks. In the case of WTI crude oil, assume that prices have rallied from $41.00 to $42.50 in the U.S. overnight. A scalper could place buy orders one tick above the 38 percent ($41.93) and 62 percent ($41.57) Fibonacci retracement levels to get in on the action.

It takes an experienced trader to manually scalp efficiently. This is because the strategy requires speed, focus, patience, and deep trading knowledge to effectively monitor the market and look for profitable opportunities within short periods of time. Second, a trader can come up with a strategy of trading a single currency pair. In this, experience has shown that the more pairs a trader trades, the more he exposes himself to risk.

What Is Forex Scalping?

The U.S. Oil Fund offers the most popular way to play crude oil through equities, posting average daily volume in excess of 20-million shares. This security tracks WTI futures but is vulnerable to contango, due to discrepancies between front month and longer-dated contracts that reduce the size of price extensions. WTI crude oil rose after World War II, peaking in the upper $20s and entering a narrow band until the embargo in the 1970s triggered a parabolic rally to $120. It peaked late in the decade and began a torturous decline, dropping into the teens ahead of the new millennium. Crude oil entered a new and powerful uptrend in 1999, rising to an all-time high at $157.73 in June 2008.

Second, use level 2 data to identify the order flow in the market. At DTTW, all our traders have access to this order flow data. Using this data, together with time and sales, you can understand crypto brokers canada the how to position your trades. After identifying the trend, the next most important thing is to decide on the entry position. Based on your risk appetite, you can trade on any market time.

Why do scalpers lose?

The reason why you lose money scalping is because: You get caught off guard by news. You don't have what it takes – if you're someone who is wishy-washy, or can't make up your mind, then scalping is not for you. You can't read the price action of the markets.

It then dropped into a massive trading range between that level and the upper $20s, settling around $55 at the end of 2017. Price action tends to build narrow trading ranges when crude oil reacts to mixed conditions, with sideways action often persisting for years at a time. In addition, not all energy-focused financial instruments are created equally, with a subset of these securities more likely to produce positive results. Alan Farley is a writer and contributor for TheStreet and the editor of Hard Right Edge, one of the first stock trading websites. He is an expert in trading and technical analysis with more than 25 years of experience in the markets. Alan received his bachelor’s in psychology from the University of Pittsburgh and is the author of The Master Swing Trader.

Indices are particularly attractive for scalping because the amount of activity that happens within individual stocks almost guarantees that there will always be decent volatility and liquidity throughout. This also means that the price action of indices is more stable and predictable, with no single stock able to heavily influence the overall price of an underlying index. This is why the bulk of scalping activity is often done using scalper bots designed to trade the market mechanically based on coded algorithms. For scalping, automated trading makes a lot of sense because it guarantees speed and efficiency in both order entry and exit. The scalper bots also ensure that consistency in strategy application is achieved.

Follow Oil Price Live Chart and Oil Price History Table

Trading with high frequencies on a short-term time frame requires the trader to act with precision. Thus, the scalper needs to have a robust trading platform at their disposal. From a scalping standpoint, reversion trading is one way to approach slow or stagnate markets.

They also need signals to get to know the latest opportunities. Stop spending time trying to figure out CL by trial and error, and watching the losses pile up. These crude oil setups, strategies, and indicators get rid of the guesswork and guide you to $500 in daily profit potential. If a trend is bullish, the scalpers will place buy positions and if the trend is going south, they will open a short position. For this reason, these traders don’t waste their time doing deep macro analysis. Scalping is a day trading strategy that involves buying and selling of financial assets within a few seconds or minutes.

As a result, Sam the scalper has decided that a bullish or bearish breakout may be in the offing. Using such compressed time frames, it’s not uncommon for an FX scalper to execute dozens of buys and sells each trading session. The scalping trading style has a collection of objectives that makes it a unique way of approaching CFDs, shares and the forex market. General Capital Brokers Ltd, trading as T1Markets, is not permitted to provide regulated financial services to residents of the United Kingdom. In addition, T1Markets is not providing investment services to the residence of Belgium, USA, Cuba, Syria, Sudan, North Korea as well as some other jurisdictions.

Many of CME Group’s New York Mercantile Exchange futures contracts track the WTI benchmark, with the “CL” ticker attracting significant daily volume. Here are five steps needed to make a consistent profit in the markets. Last but not least, we also need to define where we take profits when trading Oil. Now that Crude Oil price is satisfying these new technical requirements, we can lay down a simple entry strategy to buy Crude Oil. However, as a general rule, the Stochastic RSI indicator needs to stay above the 50 line during this time.

Step #1: Attach the Stochastic RSI indicator and the CCI indicator over the Crude Oil chart

The update I am posting on July 2019 is to add a couple of pointers that may assist those who are trading crude oil futures, looking to trade or day-trade crude oil etc. Another means to trade crude is through Exchange traded funds ETF trading. An ETF is a type of investment fund that gives traders exposure in oil markets by holding different financial assets, which could be shares of a company’s oil. In the same manner, you can buy or sell crude oil ETFs as you do with other shares in the stock market.

It is important to go for liquid markets such as EUR/USD to prevent slippage . You should be wary of advertisements or other statements that emphasize the potential for large profits in day trading. Day trading can also lead to large and immediate financial losses. Although there is no “correct answer” to the analytical question, technical analysis is often implemented in forex scalping strategies. Both fundamental and technical analysis are used by active traders from London to New York. Typically, fundamentals are favoured by longer-term traders, while technical analysis is the go-to methodology for shorter-term, intraday, day, and swing traders.

You can trade using our spread betting demo account with virtual funds before opening a live account. Spread betting is an attractive product in the UK, as it allows investors to trade tax-free on thousands of instruments, including both types of Brent and WTI crude oil. Trading within the oil markets can be a risky move, given the increased volatility throughout recent years. Where supply and demand is constantly changing, so is the price of oil.

crude oil scalping strategy

Trading signals guide customers about managing risk and made trading profitable for them. Mastering in online trading is required lot of knowledge and technical skills. Our experts made trading easy for you through their trading signals and easy trading practices. No more taking years of losses to find profitable strategies & indicators. Higher Win Rate – Your win percentage will likely be higher than other strategies because scalping only targets small profits per trade. Finally, you should be cognizant of periods when there is economic data.

What is scalp trading forex?

The strategy is the easiest to understand and gives a good percentage of positive signals, consists of three of my scripts that perfectly complement each other. On average, it gives about signals for one currency pair per trading day. Martingale or Fixed transaction amount to choose each personally, I use martin up to… However, the main difference between chevron current stock price CFDs and spread betting lies in tax treatment. Please note that tax treatment depends on individual circumstances and can change or may differ in a jurisdiction other than the UK. Oil companies and sector funds offer diverse industry exposure, with production, exploration, and oil service operations presenting different trends and opportunities.

crude oil scalping strategy

This is a quick trade that enables all traders that took that trade to walk away from the trading screens for the rest of the day. That’s the reason why we don’t want to constrain how much time it needs to stay in overbought territory for a valid trading signal. The USD is more closely tied to the price of oil than any other currency. Paying attention to events affecting the value of the dollar can help make the market more predictable. Things such as announcements from the FED, the introduction of tariffs, changes in interest rates, and other events can all directly affect the dollar’s overall purchasing power. Given this scenario, a breakout scalp could be executed by placing a stop-market buy order at $40.01.

What are the Crude Oil Trading Hours?

You can use technical indicators such as moving averages, Stochastics, and the Relative Strength Index . You can use each indicator separately or combine two or three. After identifying the trend, they will have a close look at the support and resistance points. They will therefore place a buy position at the support, and close the trade at the resistance point.

crude oil scalping strategy

However, traders must naturally also factor in losing trades – of which there will be many as a scalper – to determine profitability. Scalping is a forex trading strategy designed to generate profits by executing a large number of trades. Scalps have short durations, limited risk and minimal profit targets. Market efficiency and trade precision are important as slippage and wide bid/ask spreads can undermine performance.

The big trading volume that pours into the Oil market can generate some freakish trading opportunities for the prepared trader. It’s important to have a commodity trading strategy because no crude oil trading tips can substitute the necessary trading skills you need to survive in the commodity market. Let’s now look into what it takes to develop a consistently reliable Crude Oil trading strategy.

Economic data which is released on a daily basis is one of the key drivers of price movements. As a scalper, you will definitely need a mode of analysis to define your entry and exit positions. The best strategy to follow here is to identify the trend and then move with it. Day trading generally is not appropriate for someone of limited resources and limited investments or trading experience and low risk tolerance. You should be prepared to lose all of the funds that you use for day trading. And more importantly, you should not fund day trading activities with funds required to meet your living expenses or change your standard of living.


Picking the right one is important if you want to make good trades. The best crude oil day trading indicator is the Stochastic RSI indicator. At least that’s what we found out after trading the Oil market for many years. In the category of another crude oil trading tip, we mention that the US dollar will also affect crude oil prices. The strength of the dollar is a quick way to gauge the strength of Crude Oil prices. The primary advantages of scalping are limited systemic risk exposure and vastly reduced capital drawdowns.

Moreover, it is possible to trade not only crude oil, but also any other products based on it (such as gasoline, diesel fuel, plastics, etc.), as well as oil futures, options, CFDs, ETFs, etc. Studying price charts, graphs and technical indicators to extract numerical information is all part of technical analysis, which usually is the second stage of the process. However, both strategies are needed for oil trading, as the commodity can be highly volatile and therefore it benefits to use a comprehensive perspective. Crude oil trades through two primary markets, West Texas Intermediate Crude and Brent Crude. Permian Basin and other local sources while Brent comes from more than a dozen fields in the North Atlantic.

Ensure you only trade on a regulated and renowned commodities exchange like T1Markets. Anyone can be involved in trading CFDs and spread betting to trade the oil price movement for a wide selection of commodities, including WTI and Brent oil. Brent oil and WTI are both leveraged products; this means you only need a percentage of the full trade value to open a position.

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