This Oil trading system is extremely simple to execute and can be really profitable if traded correctly. We also review and list advanced trading systems and programs for your review, we suggest using a combination of trading systems both free and paid to optimize your earnings, please follow the instructions below thoroughly to ensure that you learn to exploit profits out of trading crude oil futures.
Step 1: Sign Up With A Broker that offers Crude Oil trading
My suggestion is sign up a Real account with Plus500, just opening an account they give you $20 free to trade with no deposit necessary, all trades are commission free with low spreads, Stocks, Indices, Commodities and Forex, Advanced Technical Analysis Tools, leverage for all trade types, best of all they offer crude oil trading and the minimum deposit at plus5000 is $100 fund using paypal, moneybookers, credit cards, wires etc.., which is perfect to test out this system ans see how profitable it is.
Step 2: Fund account and Download Trading Platform
Once You have made a deposit and downloaded and installed the Trading platform in this case Metatrader is the platform I’m using, so here is the download link if you are emulating my success. Metatrader download.
Once you have installed it and registered an account with Plus500 you will be able to login and start trading and executing the system, which I will be explaining next.
Step 3: Set Up charts to execute this System
Step 3.1: Select Crude Oil from list of trading Instruments
Step 3.2: Select time frame, at 2 hours or “2H” with some brokers & charts
Step 3.3: Right click on the chart and select “Set up indicators” see image along side for assistance.
Step 3.4: Then on the Indicators page look for the indicator called “Parabolic SAR” this is the only indicator you will need to use for this system, I did say it was easy. To many indicators can be confusing and lead to unprofitable trading with crude oil futures.
Make sure that the Parabolic SAR has the following setup (0.02;0.2). Metatrader has it set that way by default.
Step 4:Trading the system
Great if you have got this far then you are good at following instructions and will most probably make a good crude oil trader, this is the most important step as i detail how to execute buy/sell or long/short positions on the highly liquid, quick moving crude oil market. I will also highlight the places where stop losses and take profit should be.
Buy entry: When the Parabolic SAR “stars” have been following a long trend from the top and on the next candle a parabolic SAR star appears at the bottom, this indicates a BUY signal and you must enter a trade. see picture along side.
Stoploss: Set the Stoploss at 5 points/pips below the lowest candle in the last 6 hours prior (last three candle sticks)
Take Profit: Exit the trade when the there is the appearance of the Parabolic SAR star at the top.
Sell Entry: Obviously if you where in a long position and there is the appearance of the Parabolic SAR star from the top, you can reverse close your long position and enter a short position. The Sell signal works the same way as the Buy entry except you enter a short position when the “star” appears for the first time at the top of the candle sticks.
Stoploss: Set the stop loss at 5 points/pips above the highest candle stick for the last 6 hours ( three candle sticks before) as each candle stick represents 2 hours.
Take Profit: when the Parabolic SAR star changes from appearing on top of the candle sticks to the bottom, but this signals a buy entry, so this system can be traded continuously. (see image along side for short entry)
Locking in profit: There is nothing worse than going from a profitable trade to a loosing trade, so adjust stoploss every 2 hours to break even point, locking in profit.