A RAY OF HOPE FOR OIL TRADERS

“And, it’s only Monday!”

As soon as I write it, it gets thrown back in my face … well, maybe … some

potentially good news for oil traders, especially smaller trading accounts.

Yesterday’s blog highlighted the fact there isn’t any decent place to trade

either WTI or Brent crude oil … dunno yet, but maybe I was a bit premature

in that assumption.

Today, I’m at Coinexx, the place that bought out FinPro Trading, back at the

end of 2018. Before then, they were strictly a crypto trading exchange. I

talked with them earlier today, and what they tell me, is that they also bought

out Turnkey’s service provider, which I believe was Turnkey FX … I’m not

100% certain on this, as Turnkey Forex is kinda mum on the question

… interesting tidbit if true, but more to the point.

Coinexx bid/offer spreads today in WTI crude oil were 2 - 3 cents, with a 1 lot

= to 1,000 barrels. Trading is done in increments of 0.01 lots, meaning the

minimum trade size is 10 barrels [1,000 * 0.01 = 10]. Round turn commissions

are $2 per 1 lot, meaning if you trade 100 barrels of oil [$1 per penny] or 0.10

lots, your RT commission = 20 cents [about ⅕ of a minimum one penny tick].

Leverage is set by the customer at account setup, and can be set at 500X

… that means on the 100 barrels of oil at current price, the margin is about

$12 - $13.

Now, as we all know, leverage can kill you if you let it, but for a smaller

account that has maybe $200 - $500 in it, trading oil with these conditions

makes an awful lot of sense, cuz you can pick your risk level. Coinexx has

approximately 20+ crypto currencies you can utilize for deposit / withdrawal,

including the most popular Bitcoin [BTC]. Crypto is the only means for

deposit & withdrawal, so there are no bank transfers or credit/debit cards.

If you choose to open a live account and use MT4, your account can only be

based in USD or EURUSD. If you choose to use MT5, your account can be held

in USD, or the 5 crypto currencies 1) Bitcoin [BTC], 2) Bitcoin Cash [BCH],

3) Etherium [ETH], 4) Lite Coin [LTC], and 5) Ripple Coin [XRP].  

Opening an account at Coinexx [ https://coinexx.com/ ] is easy, but despite

what the website says about “no verification”, that’s simply to open an

account. To trade, deposit, & withdraw you have to provide gov’t ID & proof

of address. I haven’t heard anything but good things about Coinexx, and they

have a positive review status at Forex Peace Army … the fact they aren’t

regulated doesn’t bother me in the least cuz regulation is meaningless … go

ask REFCO & MF Global ex-customers where regulation by everybody got

them, when both went belly up … it got them shafted is where it got them

… so, it could be a good place to trade oil if your account is relatively small.

At 2 - 3 cents, the spread is reasonable considering the daily ranges are usually

well over $1+, on the vast majority of days, while the RT commission is

meaningless coming in at ⅕ of a penny move no matter what your size of trade

level. OK, so you give up a penny or two to get the size of your risk profile

where you want it … remember, this is a CFD … IMHO, the flexibility this

offers is well worth the give up of a couple of pennies … in reality, it will trade

a lot better than the NADEX call spreads, that I am sure.

Today’s oil market, a simple reflection of the U.S. stock market … where the

SP500 goes, WTI oil isn’t far behind … SP500 rallies, oil rallies … SP500

breaks, oil breaks … and everything inside the 61.00-ish - 63.50-ish range

that’s been in effect for about the last 16 trading days. Right now, nothing

else matters, and with OPEC+ meeting in June, there isn’t much to go on but

rumors about supply, and rumors about world oil demand going lower cuz of

China.

For those who want to trade oil, but don’t want the 1,000 barrel size futures

contracts, give the demo at Coinexx a shot … use the MT5 and follow the

Bitcoin trading there as well [not available on MT4] … choose 500X as

leverage to give your account margins the lowest amount possible. If they,

meaning Coinexx, can consistently keep this 2 - 3 cent spread, it should be a

clear winner for smaller accounts. Until tomorrow mi amigos!

Have a great day everybody!

-vegas