Trade of the Day

Today’s trade involved trading an Oil Sept. contract after the release of the U.S. Crude Oil Inventories at 7:30 PST.  Once the report was released, the price of Oil immediately took a big downward swing and once the move has started, I find it better to wait for an opportunity to appear rather than trying to jump on the train as I have been run over by that train plenty of times when the price changes direction.  So the first chance to enter the market came when the price had moved back towards the Moving Average blue and red lines.  The three bars in the first yellow circle all have the same low with the last bar being red and reversing the trend of the previous six bars that all had not broken their previous bars low.  So we would sell the market at a price of 64.77 and once the Parabolic SAR red triangles were broken, then we would wait to see if the price touched our target of the major support level of 64.50.  As the price moved sideways and the bars alternated colors it was a good point to get out once the two bars in the second yellow circle both had a similar high at a price of 64.57 for a $200 profit.  There was another opportunity to trade the market when the third yellow circled green bar had closed at it’s high and had a new added support level of the Parabolic SAR red triangles below as shown by the yellow line.  Once the price hit the obvious price target of the major support/resistance level of 65.00 and the two bars circled closed down red, then that’s a signal to exit the trade for another profit of $250.