Breaking my rule if Oil drops to $15p/b

[J Livermore]

Nowler,

Do you have any exit plans for your trades in the oil market or are you just waiting for signs that the rising market may someday be getting old?

I was just wondering.

 

[Nowler]

Nowler,

Do you have any exit plans for your trades in the oil market or are you just waiting for signs that the rising market may someday be getting old?

I was just wondering.

I'm fully out at the moment actually Closed the position out about an hour ago because I didn't want to pay the extortionate financing charge, lol (been doing it the last few days)

I'll enter again with a small position when the market opens again in 10mins

I might leave a position open over the weekend due to the OPEC meeting Saturday - not sure yet

The rally has been great, but I suspect we will range a little now (and I don't want to pay financing charges when I am not making money). The next week should begin to indicate how severe the second wave of covid will be (which would be bad for oil demand).

 

[Nowler]

I'm definitely interested for as long as it's under $40.
In fact... even sub 55 sounds good to me

 

[Nowler]

Not quite sure what to do with the Oil trade now.
I booked profits just before the Oil market closed (to avoid the financing fee)... left a very small position on.

I dont know whether to jump back in and size up just yet

 

[Nowler]

I still see $40+, but i'd be surprised if there wasn't a sizeable correction.
It's been a one way street the last few weeks, but we still have oversupply.

If all goes well in the next week or 2, and business really get back online, then that's demand right there. But isn't Iran having a second wave of C19? That's worse than the first...

OPEC have not kicked up any sand lately either, which is unusual.
Compliance was stressed in the most recent meeting, after some considerable non-compliance by Iraq and Nigeria.
Both nations agreed to not only stick with the cuts, but to make up the shortfall too, lol

If they couldn't meet the required cuts last time, then how can they do it this time, PLUS make up for the oversupply?

For now, I will keep a small long on at least.
But I am watching the emergence of a second wave of Covid, and thus, lockdown 2.0

 

[Nowler]

As I am online talking shit at the moment, I thought I should give a quick update on this oil trade.
I have been out of oil for about 2 weeks?? something like that...

I made phenomenal gains (up 40+% this year - though relative to my small capitalisation- i.e I am not getting the round in at the next T2W meet up I make it to, lol) on this position, but I got discouraged about 2 weeks ago.

We were already close to the $40 handle I was aiming for, and we got there way too quick!
You don't normally get such a concise correction in the markets (disclaimer - from my amateur experience) and considering this is OPEC+ we are talking about, you could get a Jew, a Catholic, a Muslim, and an Atheist to agree quicker!

I didn't see much point in 1) accruing the extortionate fee for holding the position after 10pm UK time each day when it wasn't likely to move much, and 2) the same risk reward just wasn't there anymore... I mean... at the time we had phenomenal up-side potential as a result of continued over production while at the same time trying to figure out where to store it.

Yes, demand picked up a little, but on one hand, the second wave was likely to come and bring with it reduced demand and add more pressure to the storage issue. On the other hand, we were back to pre-Covid levels, back where OPEC had their still remaining problems. This temporary agreement to cut production is not reliable.
And I have not even went into conspiracy theory zone yet where Saudi/Russia would rather ruin the US Shale.

Now we have the record high Covid numbers again (though be aware that the media is focusing on it being cases, not deaths - that's a key point to be aware of) in the US... we already saw the stupidity of humans during the hot weather, and the protests from the disgraceful killing of that man by the bellend in the cop uniform. The majority are usually wrong, and the concept of dumb money is not unique to this trading/investing game we play. This is life... we are outnumbered by morons. We have way bigger numbers of Covid to come! It will be interesting to see how the US behave during Independence Day... I still haven't gotten over the fact that we cancelled St. Paddy's Day

I can see global spikes in this virus.. I mean... at this stage this is not even a prediction... Iran, Germany, US... we are seeing it increase again, including the UK. I assume we wont over-react like we did initially. But I expect more slowdown, and I expect OPEC issues to come back again.

So until then, I am putting money into silver, and precious metal companies in light of all this funny money being printed by Central Banks, and the arificial supporting of the stock market. The economy is 100% in trouble... be under no illusion.
Are the CB's going to provide liquidity forever?

The ratio of Silver to Gold is way out of whack, which fit well with me as I can only afford silver, and that's where all the stupid money will go when they see the too expensive gold rising when the shit really hits the fan.

This blip we saw is covid related... I see no relieving the blatant problem economic problem we already had. In fact, we have exacerbated it - albeit postpone it an tiny amount longer.

I am not giving anyone advice, but I am storing my money in a Dragon Portfolio type way.

For fuck sake... look at what is happening with retail traders! lol (which ironically includes me)
Anyone else smell a bit of euphoria?

I don't rely on this much at all, but I can't help but sense that the information age has distorted the clean stages of a bubble (Displacement, Boom, Euphoria, Profit-Taking, and Panic). Just like once reliable patterns in our game... they all lose potency as more people get on-board. Which is probably why those that continue to evolve (ebb/flow) with the markets last longer than those who don't. Nothing last forever... but another important thing to remember is that history doesn't exactly repeat itself, but it rhymes!

 

[Nowler]

I'll stop editing to death that last post and just post the rest of my thoughts here.
Following on from the comment about my perceived euphoria in the markets...

Look at the amount of retail trading accounts opened since the covid shutdown.
Typically you see dumb money get into the market late, right?
The amount of RobinHood trading account that were opened by dumb money during what is supposed to be an unprecedented global economic shock is staggering! And you see them go for the likes of these massively risky moves... with the free money they were given by the gov. And this is nothing to do with the central banks!! This is the US Government, not the FED!!!

I have heard average Joe's say things during March like " the trick is to pile money in at the bottom of a decline" etc...
No, using this as a guide of what'happening is not a science... but I tell you one thing that I am certain of, and that's the dumb money is not the smart money

The history books WILL NOT read "During the Covid crisis, the global distribution of wealth was shifted from the haves, to the have-not's"

The election is right around the corner and the Government has about 3 Trillion $$ to flood the market with (no, not the Fed).

I am not claiming to know what is going to happen. I definitely do not!
But I can generally tell the difference between higher risk and low risk!

TLDR;
- Waiting on oil to correct significantly before jumping back in
- Currently loading up on Sliver and precious metal companies