Intention
I've been funded by T4T, and I'd like the account to survive to the first payout, at least . This thread is intended as my journal, where I'd like, occasionally, to throw on and keep the notes and findings of the trading CFD on oil on a funded account as I go. I failed many times with many strategies, I hope this one will turn out to be stable, tradable, and profitable. Wish me luck.
What is a Crack Spread?
In the petroleum industry, refinery executives are most concerned about hedging the difference between their input costs and output prices. Refiners’ profits are tied directly to the spread, or difference, between the price of crude oil and the prices of refined products — petrol and distillates (diesel and jet fuel).
This spread is referred to as a crack spread. It is referenced as a crack spread due to the refining process that “cracks” crude oil into its major refined products.
Learn more about Crack Spreads on the CME website or google it.
Thoughts about Brokerages
The disadvantage of trading Oil, and commodities in general, through the CFD is a big spread. So, this strategy requires brokerage, having Oil spread as low as possible. This account is traded with Eightcap with 3 pips spread on oil. This was also tested on FxPig and FxFlat accounts, with a spread of 5 pips on oil. It worked as well, but the profit is slightly lower.
I've got another account with Apex and trade the same strategy on the futures market through the Rithmic, where, IMO, works the strategy much better. But CFD world has its pros, like leverage. Hence, I've been trying to use the same strategy with CFD broker.
Trading
It's a manual day trading system, trades are monitored real-time. All orders contain TP and SL, but trades close price can differ from TP. It depends on market condition. In rush hours (RTH), with a lot of liquidity and volatility available on the market, the TP can be wider, whilst in low volatility (ETH) the profit is taken much closer to entry price.
I've been funded by T4T, and I'd like the account to survive to the first payout, at least . This thread is intended as my journal, where I'd like, occasionally, to throw on and keep the notes and findings of the trading CFD on oil on a funded account as I go. I failed many times with many strategies, I hope this one will turn out to be stable, tradable, and profitable. Wish me luck.
What is a Crack Spread?
In the petroleum industry, refinery executives are most concerned about hedging the difference between their input costs and output prices. Refiners’ profits are tied directly to the spread, or difference, between the price of crude oil and the prices of refined products — petrol and distillates (diesel and jet fuel).
This spread is referred to as a crack spread. It is referenced as a crack spread due to the refining process that “cracks” crude oil into its major refined products.
Learn more about Crack Spreads on the CME website or google it.
Thoughts about Brokerages
The disadvantage of trading Oil, and commodities in general, through the CFD is a big spread. So, this strategy requires brokerage, having Oil spread as low as possible. This account is traded with Eightcap with 3 pips spread on oil. This was also tested on FxPig and FxFlat accounts, with a spread of 5 pips on oil. It worked as well, but the profit is slightly lower.
I've got another account with Apex and trade the same strategy on the futures market through the Rithmic, where, IMO, works the strategy much better. But CFD world has its pros, like leverage. Hence, I've been trying to use the same strategy with CFD broker.
Trading
It's a manual day trading system, trades are monitored real-time. All orders contain TP and SL, but trades close price can differ from TP. It depends on market condition. In rush hours (RTH), with a lot of liquidity and volatility available on the market, the TP can be wider, whilst in low volatility (ETH) the profit is taken much closer to entry price.
Chase value, not price