Analysis of Heating Oil Commodity Spread Trade for August 2015

Romana prepared an analysis of trade she selected for August 2015. Read the complete analysis which was also published on the portal of the American Chamber of Commerce in the Czech Republic (AmCham). The calendar spread of Heating Oil can be traded with high profit potential against a low risk.

Buy Heating Oil December 15–Sell Heating Oil February 16

HO August 2015Trade analysis

  • Trade window by SeasonAlgo: trade entry on 24th July, trade exit on 1st September
  • Only 1 losing trade in last 15 years (in 2004)
  • 100% Win in last 10 years
  • Spread is traded on low prices in current year – good potential for annual seasonal price increase in the trading window
  • Strong seasonal historical patterns correlation in seasonal window
  • High Reward-to-Risk-Ratio (RRR) – 6.41 on 15 years data history
  • $447.16 average profit/year/contract Trading Strategy:

  • The spread currently test historical support level and is forming a Double Bottom pattern.
  • Entry in the trading position can be foreseen in case the spread closed above -0.0275.
  • Risk only $80 per contract with the Stop Loss at -0.0296.
  • Three Profit Targets can be used aiming for profit of $155, $268 and $386 per contract.
  • Spread trading position can be open with 6 contracts in case of minimal trading capital $10 000





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