• 4 minutes Natural gas is crushing wind and solar power
  • 7 minutes OPEC and Russia could discuss emergency cuts
  • 10 minutes Peak Shale Will Send Oil Prices Sky High
  • 13 minutes Don't sneeze. Coronavirus is a threat to oil markets and global economies
  • 2 mins On Venezuela
  • 1 hour CCP holding back virus data . . . . . . Spanish Flu 1918 MUTATED, Came in 3 waves, Lasted 14 months and killed upward 5% World population
  • 1 hour "Criticism of migration will become a criminal offense.  And media outlets that give room to criticism of migration, can be shut down." - EU Official to the Media.
  • 1 day Cheap natural gas is making it very hard to go green
  • 5 hours The Great Recession recovery wasn't powered by Obama; it was oil and gas
  • 7 hours Gold.
  • 1 min WTI are we seeing the perfect storm
  • 10 hours Engineering, Politics and Political Correctness from Down Under
  • 20 hours I Love Hills
  • 1 day Oil and gas producers fire back at Democratic presidential candidates.
  • 5 hours So the west is winning, is it? Only if you’re a delusional Trump toady, Mr Pompeo, by Simon Tisdall
  • 1 day Investments worthy in versatile and clean natural gas

Avoid Deception When Trading In Front Of Major Data Releases

Baker Hughes Rig

Trading, in any market, is about taking risk on board. Successful trading, however, is about respecting that risk and managing it accordingly, and a large part of that management is being aware of when risk could be out of your control. On Wednesday of this week, when the EIA released their weekly inventory report, the WTI futures market demonstrated why data release points are one of those times.

When I was working in foreign exchange dealing rooms we were subject to very few hard and fast rules, but squaring up in front of major figures such as the U.S. jobs report or CPI numbers was one of the few things mandated. It was recognized that you really had no better idea than anybody else what the numbers would actually be, making any trade in front of them a pure coin flip type of gamble, but there were also other, more powerful reasons not to take a position into a release.

It is quite possible that if you do so you could be completely right in your guess, but still end up losing a significant amount of money. That is what would have happened to me on Wednesday if I didn’t follow that one basic rule. I suspected, based on the last few reports, that the inventory number would be a bad one for oil prices and said as much to the Energy Trader Team Members. I also, however, cautioned against acting on that belief, and I am glad that I did.

(Click to enlarge)

The above chart shows what happened after the release. Oil futures surged on the initial…




Oilprice - The No. 1 Source for Oil & Energy News