Is Oil Topping?
Welcome to my first installment on
TradingMarkets. I look forward to keeping this column timely with my
latest trades, findings, and watch lists. You can expect irreverent, outside of
the box economic, trading, and on occasion, geo-political commentary gleaned
from my network of unique sources in the world of finance. If you are looking
for the same old thing, this is not your place. However, if you like taking
risks and thinking a bit differently I wholeheartedly welcome you! Let’s
begin…..
The DJIA
Many of you know, I currently specialize in trading the Dow
Jones Industrial Average. I trade the DJIA via the ETF symbol DIA, and
sometimes the Dow E-mini product symbol YM on the CBOT.  I utilize a channel
system that has the goal of determining statistically probable price points of
directional continuation within the particular time frame. The channel is
determined on the daily cash DJIA numbers, and trades are entered based on the
three minute time frame. This system is how I trade my larger sizes, I also, on
occasion, will enter trades based purely on statistical studies combined with
technical price factors. When these triggers fire, the trades are entered with
very small size and scaled into should they be successful. The channel system
is my primary entry method in my DJIA trades. There is an upper and lower
number. I call the area in between the upper and lower figures ” the death
channel” wherein the system stays flat. If price violates the upper channel
figure by a full three minutes, longs are entered with whatever size is
determined by risk factors based on account size and goals. I do not scale into
the system trades, but rather keep tight stops initially on the entry and enter
with full size.Â
The current DJIA channel is 10447–10553. The system is
currently FLAT the Dow at this time. However, I entered a small SHORT position
today @ 10490 and am currently holding this short into Wednesday. This trade is
a little underwater at this time….We will see what happens!
Oil
This is my first full year trading the energy complex. My
instrument of choice is the E-mini oil contract traded on the Nyme–symbol QM.
It is my contention that the rally in oil has or will shortly be topping. I base
this on chatter that I have been hearing from the hedge fund world, the overly
extreme bullish public sentiment, and my TA projections. Several so-called
experts are calling for $100.00 plus barrels soon—all indications of a top in
my opinion. Today, I shorted the QM’s at an average price of 60.60.
The Dollar
I am currently flat the EUR/USD spread at this time. It
appears that 1.2259 will be a short term high. I am looking to enter short
soon. Stay tuned!
US Equities
Presently, I am flat across the board in US equities. The
following is my current watch list, and my directional bias.
TALX— short
LCBM—long
GOOG– short
LLTC—short
MXIM—short
GM——-long
Alright, thanks for reading today! See you soon!
Dave Goodboy
David S. Goodboy (marketsurfer) has been trading
professionally for over 14 years. Mr. Goodboy trades ETF’s, stocks, index
futures, energy futures and options. His primary focus is a unique multi-time
frame index trading system based on a combination of time/price cyclical studies
and statistical models. David was a trader/partner with Biltmore Capital, traded
with an option arbitrage firm, and is currently in the launch stages of IntrendX,
a global multi-strategy fund.