| Over the last few articles we have given ideas on | | | | re tracing part of the recent break. Prices have double |
| how to enter these markets for profit and achieved | | | | bottomed at the mid Bollinger band and are trying to |
| some great gains. In this article we will look at how to | | | | find support. |
| get in on the action, if you are on the sidelines. | | | | Don't jump in to quickly |
| Many traders fail to trade energy markets correctly | | | | Would we buy at these levels? The answer is no. |
| (and others!) Why? because they use the wrong way | | | | Quite simply, there is no buying and short term |
| to time their entry and they use the wrong trading | | | | momentum indicated by the stochastic indicator has |
| vehicle. | | | | not yet turned up. |
| Let's look at a way to enter in a real time scenario. | | | | If a trader buys here, they are trying to pick a near |
| Were on board already and have profit, but how do | | | | term bottom and predict the move. |
| new traders get in lets take a look. | | | | It's better to wait for confirmation and buy strength. |
| Firstly - Ignore the news and look at what the charts | | | | You will miss part of the profit but that will be in |
| are telling you. | | | | hindsight. |
| Crude Oil & Unleaded Gas | | | | Many traders go in and try and predict where a |
| The markets are in a period of consolidation and | | | | bottom will form, but the best way to trade is to buy |
| prices have just moved from the bottom of the | | | | strength, not weakness. |
| Bollinger band and are testing the mid band. | | | | Two great tools to help you |
| Short term trends are up, with stochastic momentum | | | | The Bollinger band and stochastic indicators are great |
| supporting the move, but are a bit over bought. | | | | for helping you define your entry and exit points and |
| If want to buy now, you are trading with the trend in | | | | also giving support and profit objectives. |
| your favour ( but watch the stochastic closely and its | | | | Protect yourself |
| strong before entry) traders should use options with | | | | Energy markets are volatile and trader psychology |
| plenty of time to expiry and buy them at or in the | | | | rules not the fundamentals and these markets can |
| money. | | | | wrong foot traders who are to keen to get in and |
| This will help you to ride out any volatility or an | | | | don't give themselves the protection of a vehicle like |
| unexpected swing to the downside and place stops | | | | options. |
| bellow support. | | | | Time your entries on strength and use options to ride |
| You may want to wait for a pullback, but if momentum | | | | out swings to the downside. |
| is strong today the odds favour higher prices. | | | | Finally don't buy out the money options keep them in, |
| A close above the mid Bollinger band points to higher | | | | at or close to the money and get time on your side. |
| prices. If prices follow through to market highs a break | | | | Energy markets are volatile and can make any trader |
| of these highs leaves clear blue sky for a larger | | | | look stupid but they offer some fantastic profit |
| advance. | | | | opportunities at present which traders can take |
| Natural Gas | | | | advantage of. |
| Prices have had a swift break to the upside and are | | | | |