Crude Oil Futures Seasonality

The above chart represents the seasonality for Crude Oil Futures Continuous Contract (CL) for the past 20 years.

Date range: January 1, 1990 to December 31, 2009

Source: Equity Clock

If you look at this seasonal chart you can see the bad seasonality from October to late December. If you add the large contango in oil futures and the seasonality, you can have the perfect short.

I have been trading from the short side, mostly intraday plays.

Related ETFs: United States Oil Fund LP (ETF) (USO), Path S&P GSCI Crude Oil Total Return (OIL), Energy Select Sector SPDR (ETF) (Public, NYSE:XLE)

Contango Is Rising Again. Its The Carry Traders Paradise.

Oil futures are showing large contango spreads in the November and December contracts.

November and December futures are trading 2.3% and 4.4% respectively, above front month prices.

That is a carry trader paradise, especially if you are bearish on oil or on the economy in general. Small investors shorting the oil ETF`s also benefit from this contango that will be reflected in the ETF`s price when they start rolling over their contracts.

Related ETFs: United States Oil Fund LP (ETF) (USO), iPath S&P GSCI Crude Oil Total Return (OIL)

The Summer Is Over In Wall Street

The trading desks will begin to fill back up next week as the unofficial summer comes to an end this weekend. This usually means market activity starts to pick up again, and we could be in store for a new trend to emerge over the last four months of the year.

Futures are pointing to a lower start.

I have updated the statistics on the right corner of the website as some of you have asked. I am surprised with some hate reactions in the comments section. This is a free website, it will continue to be run in the same way despite the paid daily service upgrade.

I will give an extension of 10 days for those that subscribe the service.

On a different note, I bought a fantastic book this weekend, 21st Century Houses: 150 of the World's Best. If you like architecture and houses, you will love this one.

Have a great trading day: stay tuned for the trading action during the day.

Daily Stock Picking System

I am starting a paid daily trading service on this website. I am applying the concepts that have been working very well for me over the last few months, sending my trading stake to new all-time highs.

I have spent thousands of hours on this blog over the last 2 or 3 years, trying to enhance the readers` trading abilities, sharing thoughts and war stories. This site has grown from day 1 and is now a big trading community. Now, a part of the site will be professionally run:

This is a daily stock picking system I am offering on this site based on my research. I provide this service to institutional clients, and I am offering it here to Oil Traders Blog readers for a fraction of the price.

The subscribers will receive a daily email before 3.30 pm ET with the stock to buy for the next trading session. The stock should be held for a 24 hour period.

The stock selection is based on relative strength, excess volatility (noise), peer performance and general market condition.

Payments can be made from the button below. You can subscribe to a 1 month period for 100 USD or for a full year with a discount rate (750 USD).

(If you need further information, email me at traderhms[at]gmail.com)

Overdose: The Next Financial Crisis

"Overdose: The Next Financial Crisis: In times of crisis people seek strong leaders and simple solutions. But what if their solutions are identical to the mistakes that caused the very crisis? This is the story of the greatest economic crisis of our age, the one that awaits us."

Its a fantastic documentary, share it with your friends and colleagues.

Have a great Labor Day.

Overdose: The Next Financial Crisis" was produced by a team of filmmakers led by prominent Swedish libertarians Jonah Norberg and Martin Borgs.

The film has been broadcast in Sweden, Norway, Finland, Denmark and Australia - and won the prestigious 'Best Feature Documentary' award at the San Francisco Frozen Film Festival.

Trading oil, stocks and forex for a living.