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Rb1

GASOLINE: Turned bullish on 4H as the MA50 held.Gasoline turned bullish on its 4H technical outlook (RSI = 56.424, MACD = 0.010, ADX = 32.938) as it rebounded strongly on the 4H MA50. The overall pattern looks very much like the October 2nd 4H MA50 rebound, which rose to almost the 2.0 Fibonacci extension. That is our Target (TP = 2.1650), just under the R1 level. ## If you like our free content follow our profile to get more daily ideas. ## ## Comments and likes are greatly appreciated. ##
NYMEX:RB1!Long
by InvestingScope
GASOLINE Bottom confirmed. 3-month rally ahead.Gasoline (RB1!) formed a confirmed technical bottom on the 3.5-year Support Zone and the Lower Lows of the Falling Wedge. At the same time, the 1W RSI bounced from oversold territory (below 30.00) back above its MA trend-line, confirming a bullish reversal. The previous Lower Lows bottom reached marginally above the 0.786 Fibonacci retracement level. As a result we remain committed to our long-term Target of 2.600 (below also the Lower Highs trend-line), which we expect to get hit within the next 3 months. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Long
by TradingShot
1
GASOLINE Do-or-die moment before total collapse.Gasoline (RB1!) is approaching not only the Lower Lows trend-line from the December 12 2022 Low but also the Support Zone that has been in effect in the past 3.5 years. Naturally, this is the most critical Support Cluster of all, if the market is avoid a brutal sell-off in the coming months. That will be if Gasoline closes a month below the Support Zone. Until then, this is its last chance to stage another multi-month Bullish Leg similar to those of early 2023 and early 2024. As long as the Support Zone holds then, we will target 2.6000, which is below the 0.786 Fibonacci retracement level as well as the Lower Highs trend-line. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Long
by TradingShot
GASOLINE Strong buy opportunity.Last time we looked into Gasoline (RB1!) was exactly 2 months ago (June 06, see chart below) and the price action gave us the most optimal buy opportunity on the 0.618 Fibonacci level and hit straight on our 2.6000 Target: Since then, Gasoline declined aggressive along with most of the energy sector and even broke below the 0.618 Fib on Monday. This however is technically the ideal long-term buy entry as not only the dominant pattern remains a 2-year Channel Down but also in symmetrical terms, it appears that the price action may be on similar levels as the June 23 2023 Low. As a result, we turn bullish on Gasoline again, targeting the Internal Lower Highs trend-line at 2.7500. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Long
by TradingShot
1
GASOLINE Medium-term buy opportunityGasoline (RB1!) has been on a strong Bearish Leg ever since the April 12 High, which is a Lower High for the 2-year Channel Down, and even broke below the 1D MA200 (orange trend-line). Having already touched the 0.618 Fibonacci retracement level, we expect a medium-term rebound, similar to the one on May 04 2023. The rally not only hit and broke above the 1D MA50 (blue trend-line) but also extended as high as the 0.236 Fib. As a result, we consider the current level to have a solid R/R behind it and buy, targeting 2.600 (just below the 0.236 Fib). ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Long
by TradingShot
GASOLINE Short-term buy. Sell at the right time.Gasoline (RB1!) is on a 3-day bullish 1D candle run after testing and holding the 1D MA50 (blue trend-line) this week for the first time since February 05. On the wider scale, this is the Bullish Leg of the 18-month Channel Down and it is approaching its top (Lower Highs trend-line). As you can see, the Bullish Legs of this pattern share a certain degree of symmetry, so as it happened on April 12 2023, we expect the new Lower High to be priced near the 1.236 Fibonacci extension. That will also touch the internal Higher Highs trend-line. The symmetrical 1D MACD Bullish Cross of March 27 2023, was a signal that the Bullish Leg will soon come to an end. As a result, on the 1.236 Fib we will turn bearish and target the bottom of the (dotted) Channel Up at 2.6000. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Long
by TradingShot
GASOLINE Sell signal approachingGasoline (RBOB1!) is staging a short-term rebound towards the top of the (dotted) Channel Up ahead of a 1D Golden Cross. The 18-month pattern is a Channel Down and last time we saw those technical dynamics was during the previous Bullish Wave/ Channel Up that peaked on the 1.236 Fibonacci extension (April 12 2023) exactly on the Golden Cross and then corrected below the (dotted) Channel Up. As a result, we are starting to take a bearish stance on Gasoline, targeting 2.400 (bottom of the Channel Up). ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Short
by TradingShot
GASOLINE Buy signal if 1D MA50 breaks.Gasoline (RB1!) has had a strong 3-day rise last week but that is still contained within the bearish barriers of a Channel Down. However during this whole pattern, the 1D RSI has been developing a Channel Up, hence a Bullish Divergence for the price. As a result, we will look to the 1D MA50 (blue trend-line) for a break-out signal and if the price closes a 1D candle above it, we will buy and target the 1D MA200 (orange trend-line) with an early target projection at 2.4250 (but of course this can move depending on its course). Technically, we can even see the rise extending to +30.00% from the bottom or even slightly higher, as the two major bullish runs of 2023 have risen by +34.60% and +32.60% respectively. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Long
by TradingShot
2
🔝 US Gas prices become more affordable as key breakdown is hereAmericans could breathe a sigh of relief with gas prices set to be more affordable this year. US gas prices hit their highest 52 Weeks in August and September ahead of Labor Day, with the national average standing at $3.82 a gallon FRED:GASREGW , per AAA Gas Prices . Gasoline prices hit summertime levels in over a decade even as the driving season comes to a halt, as a result of rising crude-oil prices TVC:USOIL driven by production cuts. Brent crude TVC:UKOIL , the international benchmark, jumped to $90 a barrel earlier is September for the first time in 2023 after both Saudi Arabia and Russia extended oil production cuts of 1.3 million barrels a day through December 2023 in a bid to maintain price stability. Higher US gas prices NYMEX:RB1! are a problem for the Federal Reserve, which has been trying to tame historically high inflation. The central bank has already hiked interest rates ECONOMICS:USINTR by more than 500 basis points since March 2022, helping lower the pace of consumer-price increases to 3.2% in July from last year's highs above 9%. But the jump in fuel prices is threatening to derail the progress the Fed has made in taming inflation. As a result, just after September, 2023 FOMC meeting market participants are waiting one or maybe two dovish Fed's Rate price actions in 2024. At the same time before September, 2023 Federal Reserve meeting, market expectations were about three cuts, near to four. (up to 100 b.p.). Meanwhile juts a take a look what technical picture in RBOB Gasoline futures RB1! price says. Near the middle of August, 2023 Gasoline futures prices turned massively down, due to seasonal backwardation in RBOB futures contracts, where autumn RBOB futures contracts are usually to be trade lower vs. summer RBOB futures contracts. Moreover, in the last day of Q3'23 RBOB futures price turned firmly lower, breaking down the major trendline support that was actual all the time from disinflationary Covid-19 era. Moreover weekly SMA(52) is broken down also. In a conclusion, I have to say that retail gasoline prices are usually to follow the major trend, within one or up to two months.
NYMEX:RB1!
by Pandorra
Primer on Crude Oil Crack SpreadEver dreamt of being an oil refiner? Fret not. You can operate a virtual refinery using a combination of energy derivatives that replicates oil refiner returns. Crude oil is the world’s most traded commodity. Oil consumption fuels the global economy. Crude is refined into gasoline and distillates. Refining is the process of cracking crude into its usable by-products. Gross Processing Margin (GPM) guides refineries to modulate their output. Crack spread defines GPM in oil refining. This primer provides an overview of factors affecting the crack spread. It delves into the mechanics of harnessing refining spread gains using CME suite of energy products. UNPACKING THE CRACK SPREAD Crack spread is the difference between price of outputs (gasoline & distillate prices) and the inputs (crude oil price). Cracking is an industry term pointing to breaking apart crude oil into its component products. Portfolio managers can use CME energy futures to gain exposure to the GPM for US refiners. CME offers contracts that provide exposure to WTI Crude Oil ( CL ) as well as the most liquid refined product contracts namely NY Harbor ULSD ( HO ) and RBOB Gasoline ( RB ). Crude Prices Crude oil prices play a significant role in determining the crack spread. Refining profitability is directly impacted by crude oil price volatility which is influenced by geopolitics, supply-demand dynamics, and macroeconomic conditions. Higher oil prices lead to a narrowing crack spread. Lower crude prices result in wider margins. Expectedly, one leg of the crack spread comprises of crude oil. Gasoline Prices Gasoline is arguably the most important refined product of crude oil. Gasoline is not a direct byproduct of the distillation process. It is a blend of distilled products that provides the most consistent motor fuel. Gasoline prices at the pump in the US vary by region. Price differs due to differences in state taxes, distance from supply sources, competition among gasoline retailers, operating costs in the region, and state-specific regulations. CME’s RBOB Gasoline contract provides exposure to Reformulated Blendstock for Oxygenate Blending (RBOB). It is procured by local retailers, who blend in their own additives and sell the final product at pumps. RBOB is blended with ethanol to create reformulated gasoline. It produces less smog than other blends. Consequently, it is mandated by about 30% of the US market. RBOB price is thus representative of US gasoline demand. Each CME RBOB Gasoline contract provides exposure to 42,000 gallons. It is quoted in gallons instead of barrels. The contract size is equivalent to one thousand barrels like the crude oil contract. Distillate Prices Distillate or Heating Oil is another important refined product of crude oil. Distillate is used to make jet fuel and diesel. Demand for distillate products is distinct from gasoline demand. A substantial portion of the North-East US lack adequate connection to natural gas. Hence, the region depends on HO for energy during winters making HO sensitive to weather. CME NY Harbor ULSD contract ("ULSD”) provides exposure to 42,000 gallons of Ultra-low sulphur diesel which is a type of HO. ULSD contract is also equivalent to one thousand barrels. Chart: ULSD Price Performance Over the Last Twenty Years. TRADING THE CRACK SPREAD The crack spread can be expressed using the above contracts in three distinct ways: 1) 1:1 SPREAD This spread consists of a single contract of CL on one leg and a single contract of one of the refined products on the other. This spread helps traders to express their view on the relationship between single type of refined product against crude oil. It is useful when price of one of the refined products diverges from crude oil prices. 1:1 spread is also useful when there are distinct conditions affecting each of the refined products. 2) 3:2:1 SPREAD This spread consists of (3 contracts of CL) on one leg and (2 contracts RBOB + 1 contract of ULSD) on the other leg. The entire position thus consists of six contracts. It assumes that three barrels of crude can be used to create two barrels of RBOB and one barrel of HO. This trade is better at capturing the actual refining margin. It is commonly used by refiners to hedge their market exposure to crude and refined products. 3:2:1 spread is used by investors to express views on conditions affecting refineries. 3) 5:3:2 SPREAD Spread consists of (5 contracts of CL) on one leg and (3 contracts of RBOB + 2 contracts of heating oil) on the other leg. This spread captures the actual proportions from the refining process. However, it is much more capital-intensive. FACTORS IMPACTING CRACK SPREAD Seasonality, supply-demand dynamics, and inventory levels collectively impact crack spreads. Seasonality Mint Finance covered seasonal factors affecting crude oil prices in a previous paper . In that paper, we described that crude seasonality is influenced by variation in refined products demand. In summer, gasoline demand is higher, and, in the winter, distillate demand is higher. Seasonal price performance of the three contracts is distinct leading to a unique seasonal variation in various crack spreads. Summary performance of the three spreads is provided below. Chart: Seasonal price performance of Crude, its refined products, and their spread (excluding years 2008, 2009 and 2020 in which extreme price moves were observed) Refiners strategically time their operations based on seasonal trends, ramping up refinery capacity ahead of peak demand in summer and winter. This involves building up inventories to meet anticipated high demand. However, this preparation often results in a narrowed spread just before peak utilization. As the spread reaches its lowest point, refiners take capacity offline for maintenance. Subsequently, crack margins begin to expand as refined product supplies dwindle, aligning with decreased crude oil consumption. This results in a gradually increasing spread through high consumption periods. Supply/Inventories Supply and inventories of crude oil and refined products influence crack spreads. When inventories of refined products remain elevated, their prices decline narrowing the spread. When the production and inventory of crude oil is elevated, its price declines leading to a widening spread. On the contrary, low inventories of refined products can lead to a wider crack spread and low inventories of crude oil leads to a narrower crack spread. Demand Refinery demand has a self-balancing effect as higher refining requires higher consumption of crude which acts to increase crude oil prices. Demand for crude oil and refined products is broadly correlated. However, there are often periods when demand diverges on a short-term scale. Economic activity and available supplies drive demand for refined products. During periods of high economic growth, refined product consumption is robust pushing their price higher. Demand for refined products can precede or lag demand for crude oil from seasonal as well as trend-based factors. This lag can be identified using the crack spread. Sharp moves in crack spread pre-empt moves in the underlying which act to normalize the spread. CURRENT CONDITIONS There are two trends defining the crack spread currently: 1) Divergence in demand & inventories of gasoline and distillates: Low demand for gasoline is evident due to expectations of an economic slowdown while gasoline inventories remain elevated. Though, distillate consumption remains high as inventories are declining and lower than the 5-year average range. Chart: Divergence in inventories of distillate and gasoline (Source – EIA 1 , 2 ). Moreover, inventories of gasoline and distillates are higher than usual. Both factors together have led to a gloomy outlook for refined product demand. Gasoline stocks have started to increase while distillate stocks are still declining. When refined product inventories are elevated investors can position short on the crack spread in anticipation of ample supply. Conversely, if refined product inventories are low, investors can position long on the crack spread. Chart: Divergence in refined product inventories in US (gasoline rising and distillate declining). 2) Declining crude price and tight supplies: In September, Saudi Arabia and Russia announced supply cuts extending into January. Globally, this led to a supply deficit of crude oil. Supplies of crude in the US was particularly stressed as refiners increased utilization to build up inventories while margins were high and exacerbated by a pipeline outage. Chart: Crude Oil inventories in US have stabilized in September and October. Following increase in oil prices, refining activity has slowed, and supplies have become more stable. When inventories of crude are stable or elevated, it indicates less demand from refiners. Investors can opt to position long on the crack spread anticipating ample crude supply. Chart: US Refinery Utilization and Crude Inputs have slowed in October. Although, crude oil supply cuts from Saudi are going to continue until January 2024, there is no longer a deficit as consumption has slowed down. Together, both trends have caused a sharp collapse in the crack spread. Value of the 3:2:1 crack spread has declined by 50% over the past month. Prices of refined products have been affected more negatively by low demand than crude oil. Inventories and supply situation for refined products is more secure than crude oil. Still, seasonal trends suggest an expansion in crack spread once refined product inventories start to be depleted. HARNESSING GAINS FROM CHANGES IN CRACK SPREAD Two hypothetical trade setups are described below which can be used to take positions on the crack spread based on assessment of current conditions. LONG 3:2:1 SPREAD Based on (a) sharp decline in crack spread which is likely to revert, and (b) seasonal trend pointing to increase in the crack spread, investors can take a long position in the crack spread. This consists of: • Long position in 2 x RBF2024 and 1 x HOF2024 • Short position in 3 x CLF2024 The position profits when: 1) Price of RBOB and ULSD rise faster than Crude. 2) Price of Crude declines faster than RBOB and ULSD. The position looses when: 1) Price of Crude rises faster than RBOB and ULSD. 2) Price of RBOB and ULSD declines faster than Crude. • Entry: 63.81 • Target: 79.12 • Stop Loss: 55.73 • Profit at Target: USD 45,930 ((Target-Entry) x 1000 x 3) • Loss at Stop: USD 24,240 ((Stop-Entry) x 1000 x 3) • Reward/Risk: 1.89x LONG 1:1 HEATING OIL SPREAD Based on relative bullishness in distillate inventories plus stronger seasonal demand for distillates during winter, margins for refining heating oil will likely rise faster than gasoline refining margins. Focusing the expanding crack margin on a 1:1 heating oil margin spread can lead to a stronger payoff. This position consists of Long 1 x HOF2024 and Short 1 x CLF2024 . The position profits when: 1) Price of ULSD rises faster than Crude. 2) Price of Crude declines faster than ULSD. The position will endure losses when: 1) Price of Crude rises faster than ULSD. 2) Price of ULSD declines faster than Crude. • Entry: 36.15 • Target: 42.79 • Stop Loss: 32.3 • Profit at Target: USD 6,640 ((Target-Entry) x 1000) • Loss at Stop: USD 3,850 ((Stop-Entry) x 1000) • Reward/Risk: 1.72x KEY TAKEAWAYS Crack spread refers to the gross processing margin of refining (“cracking”) crude oil into its by-products. Refined products RBOB and ULSD can be traded on the CME as separate commodities. Both are representative of demand for crude oil from distinct sources. There are three types of crack spread: 1:1, 3:2:1, and 5:3:2. a. 1:1 can be used to express views on the relationship between one of the refined products and crude. b. 3:2:1 can be used to express views on the refining margin of refineries. c. 5:4:3 can give a more granular view of proportions of refined products produced at refineries but is far more capital-intensive. Crack spreads are affected by seasonality, supply, and inventory levels of crude and refined products, as well as demand for each refined product. A low-demand outlook for refined products of crude is prevalent due to expectations of an economic slowdown. MARKET DATA CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
Editors' picks
NYMEX:RB1!Long
by mintdotfinance
12
GASOLINE Excellent short-term buy opportunity.Gasoline (RB1!) is on a minor pull-back on the 1D chart, below both the 1D MA50 (blue trend-line) and the 1D MA200 (orange trend-line). The 1D RSI has been rebounding since the October 05 oversold bottom, something that has done the exact same way the previous two times on May 04 2023 and December 08 2022. Both of those fractals have (so far) similar structure with the current sequence since the September 13 High, and both reached at least their 0.618 Fibonacci retracement level on those rebounds. As a result, we are taking advantage of the current pull-back to get a more comfortable low risk buy and target 2.500 (marginally below the 0.618 Fibonacci level). ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:RB1!Long
by TradingShot
1
GASOLINE: Over the 1D MA50, estabilising the new rally.Gasoline is on a neutral 1D technical setting (RSI = 51.588, MACD = -0.026, ADX = 46.131) as it only crossed over the 1D MA50 on Monday. That was after a 3 week consolidation between the 1D MA50 and the 1D MA200, which held and kept the price over the bottom of the long term Channel Up. We consider this breakout as the final confirmation of the new rally to the top of the Channel Up. Buy and aim at a rise close to +30% (TP = 3.200). ## If you like our free content follow our profile to get more daily ideas. ## ## Comments and likes are greatly appreciated. ##
NYMEX:RB1!Long
by InvestingScope
RBOB Gasoline FuturesGood morning, I have traded this for the last 15 years, I am 14-1 on this trade, has a high probability of success. Time Frame is 8/2-8/19. The initial "crash and return to mean" is due to the seasonal demand consequence of the market. Low margin req, calender spreads would be a good option, I will let you figure out the set up as I can't give everything away. Entry can be tricky as, 80% of the trades in the last 15yrs have been initiated on 8/2, the other 20% on 8/3 to 8/4. After analyzing the trades the best equity option for this trade is usually realized between 8/8-8/11 (15yr average best entry range) as an entry and it varies however that is why you need to be monitoring this extremely boring trade. Exit will be on 8/16->8/18. Now the other issue is the open interest on the September contract, if you will be going that route on the front or back end, as it will exit quickly between this exit timeframe so do not hesitate to offset contracts a little early as 42,000 barrels of gasoline showing up at your house is not part of the plan. Be diligent on this trade as it has a high success rate however there are some hidden pitfalls in this trade. "No sleep and I sound like a suit again, vague, gives hints, and is kinda dumb." -Kewlkat
NYMEX:RBU2023Long
by kewlkat
GASOLINE futures fall to 5-week low on low demand,high inventoryGasoline futures have dropped to a five-week low of $2.6 per gallon, primarily due to an unexpected increase in inventory and a decline in demand. Recent data from the Energy Information Administration (EIA) indicates a decrease in gas demand from 8.936 million to 8.519 million b/d last week. Moreover, the total domestic gasoline stock has increased by 1.3 million bbl, while markets had anticipated a draw of 1.267 million. Additionally, WTI crude prices have been falling since hitting a five-month high in April, amid concerns that a slowdown in global growth could dampen fuel demand. Furthermore, OPEC+ has announced a surprising reduction of output by 1.6 million barrels per day for the remainder of 2023, which may further impact fuel prices. From a technical standpoint, the current price is within a bearish flag on a short continuation pattern. The next potential support area is at $2.0 If the price breaks the dynamic trendline of the channel, we may witness a further drop in gasoline prices.
NYMEX:RB1!Short
by FOREXN1
9
Energy holding onThe DXY normalization is far too good. Make good use of it, and make improvements on it, as you must. The accuracy, in even such long timeframes, is incredible. For the retracements, the magnet tool was used, and the retracement is in fib scale. Therefore nothing was placed by chance. Also look at the short-term accuracy. Look at the standard SPGSCI. It is lying a little. I have to admit that on the standard chart of SPGSCI, the 2.618 retracement from 1990 to 1998, points at almost the precise top of 2008. So I guess when the standard retracements don't work, transform them. Or perhaps the recent extreme change in dollar value justifies normalization. The point is: the standard price of SPGSCI, as well as USOIL and other commodities, make sense when talking about the US economy. The 2008 peak in oil was not a worldwide energy crisis. The balance changes now, when the price of commodities are defined from the worldwide economy strength. With China now being a substantial energy user, not just the US. The DXY transformation just takes into account an average world currency price. An imaginary "world currency" (coming soon in your favorite color) Tread lightly, for this is hallowed ground. -Father Grigori
TVC:DXY
by akikostas
Fuel SeasonalityAs someone who works in industry with large consumption of diesel fuel, we are very concerned and interested in fuel. This past few weeks while gasoline is dropping, diesel fuel is in a price similar to the beginning of Ukraine war. So when will prices go back to "normal"? As you can see in the included image, relative price between gasoline and diesel is very consistent in the way it moves every year. With a very similar and consistent variance. Diesel remained abnormally high between August of 2008 to January of 2009, bottoming in May 2009. This is apparent in the seasonality chart I made. Because of the extreme prices gasoline reached during the summer, the problem for diesel will continue for the entire winter. A single event (Ukraine war) caused a price chaos that lasts a year. Who knows what extremities will occur if, god forbid, a scaled war begins. PS. I have made statistics regarding DJI, kWh, NG1!, RB1!/USOIL, and RB2!-RB1! Maths and statistics are beautiful. This is not trading advice, this is art. Tread lightly, for this is hallowed ground. -Father Grigori
FRED:DDFUELUSGULF
by akikostas
The most accurate retracementRB1! by itself doesn't like to follow retracements. That is because it is not normalized with dollar strength. After all, gasoline consumption is highly affected by the strength of the average salary. Also take a look at where we landed. Crude and its products show strength during the last weeks. The point we are testing is not a random point, as the standard RB1! would tell you. The point we stopped is the 1.272 retracement from the 2008 high to the 2020 bottom. We surpassed it by a mere $0.012 as we had, to initiate a sell-off. Now prices maybe have landed. Also compare this with the standard RB1! value, to see the tremendous difference. I always found it annoying for commodities (amongst other stuff) not to follow accurately such retracements. With this transformation it is very neat. It's like seeing behind the curtain. PS. Not everything is money. These charts are beautiful, admire them for what they are. It is nice when maths show some incredibly accurate results. I avoid giving trading advice because maths is more beautiful than useless colorful pieces of paper, and round pieces of metal. PS2. Even if I show these charts, I don't always know what they mean. And I don't have to know, or figure out what they mean. PS3. Don't fall for the "go long" or "go short" trap. A successful trader must have a probabilistic thinking, and have a plan for ANY outcome. Tread lightly, for this is hallowed ground. -Father Grigori
TVC:DXY
by akikostas
The future of commoditiesI have stated in previous ideas that stonks vs commodities are gonna lose big time. And this is more clearly observed comparing the main indices with something of value (like silver) to compare this century with the last one. Silver is used because gold used to have a relationship with USD. Now we normalize RB1! by multiplying it with DXY. This calculates the effective value of the commodity. Because RB1! is measured in gallons/dollar, we have to take USD out of the equation. And that, because of the explosive nature DXY showed the last year. A rising dollar will lower a value calculated with it. So as you can see, this year's RB1! growth is actually much larger, because dollar was also very strong. RB1! didn't seem to follow long-term fibonacci measured on it's own. With DXY in the equation, it is MUCH simpler and more predictive. The retraction from the top of 1990, to the bottom of 98, sets the stage for the long-term resistances of 1.272, 2 and 2.414. And price always reacted to it accordingly. Also from the top of 2008, to the bottom of 2020, define EXACTLY the peak we reached this summer, the 1.272 extension. The path the price will follow is drawn in a similar fashion to how price behaved in 1998-2008. Low prices are expected for the following years because of the probable bubble-burst that already took place. And prices to skyrocket in the following years, because production will greatly lower since the masses will consume electricity (or be forbidden from it as well - this is a long conversation which doesn't belong here), and diesel/gasoline fuel will remain for industrial use. Gasoline price DEFINES the buying strength of the consumer. It is crucial that its extremes are compared by normalizing it with the strength of currency. Most consumers have predictive/specific wages which lose/gain purchase value according to what dollar does, so it is vital to normalize prices. I advice you all to not analyze price on it's own. And for SPX and commodities it is highly encouraged that you change the way you perceive price, because dollar's nature has completely changed and is blurring the picture. PS. Maybe normalizing them with DXY is wrong, the chart however shows some very accurate long-term-movement, that precisely respects the retracements. Tread lightly, for this is hallowed ground. -Father Grigori
TVC:DXY
by akikostas
GASOLINE Head and Shoulders likely to turn long-term bearishGasoline (RB1!) has been rising since the March 2020 bottom on a straight Channel until late February 2022 where war and inflation worries turned it parabolic as illustrated by the use of the Fibonacci Channel extensions. Following the June 06 market top, a Head and Shoulders (H&S) pattern was formed that hit (and so far rebounded on) the 1D MA200 (orange trend-line), a level touched for the first time since December 23 2021. A break below the Support, should target the lower extension of the 1D MA300 (green trend-line), if not a retest of the Shoulder Resistance and potentially rejection on the 1D MA50 (blue trend-line) would initiate the 1D MA300 drop. This trend-line has been Gasoline's Support since December 08 2020. This however may be the perfect opportunity to break it finally as the H&S pattern typically end such parabolas in fashion to at least the 0.618 Fibonacci Retracement level. Interestingly enough, that happens to be currently on the 1W MA200 (red trend-line). -------------------------------------------------------------------------------------------------------- Please like, subscribe and share your ideas and charts with the community! --------------------------------------------------------------------------------------------------------
NYMEX:RB1!Short
by TradingShot
1
Gasoline Bearish Formation"Gasoline... breakfast of champions" - Joe Dirt Consistent with our view of #Oil, gasoline shows us a beautiful bear wedge. Are we all just expected to pay $4.50+ / gal of gasoline? This seems like a tall ask for the American consumer, considering prices are significantly elevated across most of the American ( & global ) economy. Emerging markets getting beat up all around the globe Commodities have started to selloff Interest rates are rising USD ripping higher crypto bubble... popping...? Let's see how it goes! God bless!
NYMEX:RB1!Short
by ChiefMacro