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CL Light Crude Analysis TPO/MP/VWAP/VPOC


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CL Light Crude Analysis TPO/MP/VWAP/VPOC

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  #1501 (permalink)
 
Private Banker's Avatar
 Private Banker 
La Jolla, CA
 
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greenr View Post
Great stuff here

Did you PC keep up with that Ben

Today is the 1st time my PC has frozen and lagged in a long time

Crazy price action

What the hell kicked that mess off

One min we were stable........the next second a nuclear bomb went off

Yep, no problem there. Sierra is extremely stable. The algo is designed to sweep the book.

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  #1502 (permalink)
 
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 Tiger45 
San Diego, CA, USA
 
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Anyone else show an unfilled gap from Feb 20th?


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  #1503 (permalink)
 greenr 
london/england
 
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Tiger45 View Post
Anyone else show an unfilled gap from Feb 20th?


Hey yes.....

Iv had big problems this last few days

About having the correct view on my data

After a long few days of confusion and bugging the crap out of a advanced trader

This is the view im going with now....

why becuase aparently its the best way to track the latest invontery in the market and thats what we care out as day traders

Here is the view im using as of today



So at the moment im using competley back adjusted data though kenetic though all contracts

" I will follow my rules, I will take my stops, I will be disciplined and i will work with the market....NOT AGAINST IT! Professional mind control is the key"
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  #1504 (permalink)
 
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 Brutus 
Adelaide Australia
 
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Brutus View Post
Thanks.

Private Banker is there any reason as to why you use unadjusted data during rollover?




greenr View Post
In the case he does not get back to this.....

I believe it is because he focuses a lot more on the big picture levels and structure

This is because that is what this smart money is tracking for their positions

So it makes sense to use the big picture to get a grasp on levels and structure

Then zoom in on the TPO`s to trade intra day


This makes more sense to me, the commercials & hedgers trade levels from which they profitability run their businesses.

Why have you changed your view, was it PB's suggestion?

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  #1505 (permalink)
 greenr 
london/england
 
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Brutus View Post
This makes more sense to me, the commercials & hedgers trade levels from which they profitability run their businesses.

Why have you changed your view, was it PB's suggestion?

Yes pretty much

The trouble is......

Ben will do one thing for a while, then suddenly change

I mean we have been tracking a certain big picture on CL since x-mas now

But all of a sudden Ben has changed his view

For the right reason i expect and the trouble is Ben is on another plant to any of us

He completely understand all aspects of nearly everything it seems to me lol

So when Ben does some thing or say something....its for a very good reason and Ben has a logical perspective why

For me half the time i donít understand but im slowly learning.....this yearís learning curve has been the steepest in my career so far

I mean to me logically my data was correct for my own reasons, it seemed logical to me with the previous levels we put in at the time on the contracts we were trading

But i dont fully understand how these markets work from a advance understanding on managing money and inventory correctly over a longer period

Any ways it kind makes sense to me now i know in depth a bit more why

Constantly frying my brain @Private Banker!!

" I will follow my rules, I will take my stops, I will be disciplined and i will work with the market....NOT AGAINST IT! Professional mind control is the key"
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  #1506 (permalink)
 
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 Private Banker 
La Jolla, CA
 
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Here's the thing with Crude Oil. It rolls its contracts every month so, there becomes confusion as to how you would manage that. Theres no cash index to reference which makes it difficult. The question then becomes, should you use a continuous contract or should you be using the continuous contract that is back-adjusted?

Let's take an example that would provide some clarity. Suppose a hedge fund is short from say September 14th of last year. What are they doing from that point and how are they managing their position? They're rolling their position each month. The only way to accurately track the PnL on this would be by using a continuous back-adjusted contract. Although the back-adjusted contract produces a spurious price level from the past, it reflects an exact calculation of how the trade is with regards to PnL.

A straight forward continuous contract with no adjustments is a great way to track long term price levels which play more into a psychological aspect. For example, Crude trading above $100/barrel. But again, the problem with this is whether or not inventory cares about those levels.

What's important for intra-day trading? The most important points of reference for an intra-day trader are recent and current market sentiment. That means the previous few sessions have the most bearing in trade location. Does a gap from 3 months ago have a massive influence on where you take your trade that will last a few minutes? Maybe but I'd tend to lean more on recent sentiment. Is there resting inventory based on a standard continuous contract or is it based on the continuous back-adjusted contract? I'd say the later of the two as each month's contracts are being rolled.

I haven't changed or constantly changing what I'm doing contrary to what @greenr has stated. I have not and not certain if I ever will fully divulge the way I view and manage the markets. However, I enjoy helping others which is why I've been an active participant here. If I can help a few guys out with my experience, its a great feeling for me.

Hopefully that makes sense.

Ben

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  #1507 (permalink)
 greenr 
london/england
 
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Private Banker View Post
Here's the thing with Crude Oil. It rolls its contracts every month so, there becomes confusion as to how you would manage that. Theres no cash index to reference which makes it difficult. The question then becomes, should you use a continuous contract or should you be using the continuous contract that is back-adjusted?

Let's take an example that would provide some clarity. Suppose a hedge fund is short from say September 14th of last year. What are they doing from that point and how are they managing their position? They're rolling their position each month. The only way to accurately track the PnL on this would be by using a continuous back-adjusted contract. Although the back-adjusted contract produces a spurious price level from the past, it reflects an exact calculation of how the trade is with regards to PnL.

A straight forward continuous contract with no adjustments is a great way to track long term price levels which play more into a psychological aspect. For example, Crude trading above $100/barrel. But again, the problem with this is whether or not inventory cares about those levels.

What's important for intra-day trading? The most important points of reference for an intra-day trader is recent and current market sentiment. That means the previous few sessions have the most bearing in trade location. Does a gap from 3 months ago have a massive influence on where you take your trade that will last a few minutes? Maybe but I'd tend to lean more on recent sentiment. Is there resting inventory based on a standard continuous contract or is it based on the continuous back-adjusted contract? I'd say the later of the two as each month's contracts are being rolled.

I haven't changed or constantly changing what I'm doing contrary to what @greenr has stated. I have not and not certain if I ever will fully divulge the way I view and manage the markets. However, I enjoy helping others which is why I've been an active participant here. If I can help a few guys out with my experience, its a great feeling for me.

Hopefully that makes sense.

Ben

Better way of putting it

You have had the same view and prespective all along

Its just the views i have seen you publish and i have followed


" I will follow my rules, I will take my stops, I will be disciplined and i will work with the market....NOT AGAINST IT! Professional mind control is the key"
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  #1508 (permalink)
 
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 Big Mike 
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Private Banker View Post
Let's take an example that would provide some clarity. Suppose a hedge fund is short from say September 14th of last year. What are they doing from that point and how are they managing their position? They're rolling their position each month.

I would think they are not trading the front month, but instead maybe trading the Dec 13 or etc.

Mike

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  #1509 (permalink)
 
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 Private Banker 
La Jolla, CA
 
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Big Mike View Post
I would think they are not trading the front month, but instead maybe trading the Dec 13 or etc.

Mike

That's a great point. It really depends on what they're doing. Trading the further out months obviously allows for more time to have the trade on while not having to worry about rolling however, the front month will have the liquidity and many funds trade around their core position with the front month as a "hedge". Of course the term hedge fund is very broad but my point was with regards to what I just explained.

Cheers,
Ben

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  #1510 (permalink)
 kulu 
Buckeye Nation
 
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I was just reading through some James Dalton articles and came across one that he wrote about Buying and Selling Tails. Here is what he said:

"I have often commented that learning about buying and selling tails was one of the most costly concepts introduced to me. Tails are only one data point; however, when we first become aware of them they are so linear, visual, measurable, and intuitive, that we lean on them, seeing them as an actionable trading tactic. When our observations result in profitable trades, we become even more sensitive to their forming. We start to look for them, often at the expense of more important market -generated information that is developing. Said another way, our focus often
narrows to hone in on tails, much like when you buy a car and start to see your car model on the road everywhere. The car was always in your sight; what shifted was your focus."

Again, just like @Private Banker and other posters on here have mentioned, we have to look for more than just highlighting these tails.

Cheers, Kulu

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