The ‘Better’ indicators aren’t optimised, so use them on any market or timeframe. Crude Oil is one of the futures markets where they work particularly well.
Crude Oil has become a great day trading vehicle over the last few years. There is plenty of volume (liquidity), volatility (intra-day range) and “mini” contracts available (symbol QM) – which are essential for a good day trading market.
The video above shows how the 3 non-correlated indicators (Better Sine Wave, Better Momentum and Better Pro Am) can be used for day trading Crude.
Over-optimization will always kill a system – I’ve learned that the hard way. And I’ve gone out of my way to make sure the ‘Better’ indicators are not optimized for any particular market. The indicators are “dynamic” and no input values need to be chosen for any market or timeframe.
The same day trading principles apply to Crude Oil
Since Crude Oil has large daily volume traded you should be able to stick with the normal day trading timeframes that I use on the Emini – that is 500, 1,500 and 4,500 tick charts.
However, the largest volume goes through the large contract (symbol CL), instead of the “mini” contract (symbol QM). I would suggest charting the CL contract but maybe taking trades on the QM contract if you have a small account.
The screenshot above of the 500 tick Crude Oil chart shows turning points repeat the same sequence of price, volume and average trade size:
- Exhaustion buying/selling volume
- Volume divergence with less buying/selling and higher highs/lower lows
- “End of Trend” price cycle warning signal
- Cycle turn after “End of Trend” is often low risk entry point, and
- Professionals active at price extremes
And remember to always trade in sympathy with the trend in the higher time frames.
Another Crude Oil day trade example
Crude Oil Day Trade Example – 1 Nov 2011 (5:55)
I love getting videos from subscribers showing their trading charts and how they use the ‘Better’ indicators. So thank you to Starling H. – one of Emini-Watch’s loyal fans – for letting me share this great Crude Oil trade with the followers. Crude Oil is one of a handful of non-equity futures that suit the ‘Better’ indicator setup well. See also: trading Forex with the Better Indicators and whether the indicators work on Bitcoin – a more mixed result.
