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BOOK YOUR FREE STRATEGY SESSION NOW >>The RBOB Gasoline is the futures that tracks the trend of gasoline prices in the United States.
This market is currently suitable for systematic trading but it's important to remember that liquidity can be low at certain times of the day.
In this video, we will give you some valuable tips for trading these futures and introduce you to two strategies from our portfolio that are performing very well.
By watching the video, you’ll discover:
-How the two strategies are structured
-Their recent performance
Enjoy! 😎
Hey, everyone, and welcome back to our usual chat that we have about the strategies in our portfolio that have performed the best over the last period.
One of the coaches at Unger Academy here, and in this video, we're going to be taking a look at two strategies that have performed well in the gasoline market recently.
As I mentioned a bit earlier, we’re going to be talking about gasoline futures, the RBOB Gasoline.
This is a very volatile commodity that has a Big Point Value, so the value of one point, that is $42,000. In contrast, a single tick (and you could say these futures are very scalable but also very illiquid) is only worth $4.20.
But with this product here, especially in certain hours, for example, during these phases, namely, the night hours when it's nighttime in America these products aren’t traded much, so avoid trading during those hours.
Indeed, you’ll see that this strategy won’t work during those hours but instead will have a time window that will be activated from 8:00 am and last until 12:00.
In this time window, the strategy will try to buy at the highs or lows reached so far in the current session.
This strategy will eventually close if a stop loss or take profit isn’t reached set at $1,200 and $2,500, respectively.
This strategy closes at the end of the day anyway, so it’s an intraday strategy.
You can find this strategy in the book "The Unger Method," which, by the way, costs nothing; you only have to pay the shipping costs to get it to you. And it's worth it. Trust me!
I'm going to leave a link in the description below.
And you see, lately, this strategy is following what was, let's say, the trend also of the in-sample period so definitely an excellent strategy that shows that it’s doing very well over time and that it could, let’s say, provide satisfaction in the future, and that's what we’re all hoping for.
The average trade stands at $116. These are results already net of commissions and slippage, so we could say the gross amount would be a little bit more.
Let's take a look at how much we paid for commissions.
So, for a total Net Profit of $140,000, we paid $57,000, or, let's say, entered that amount for costs.
So, also a pretty pessimistic view, but not too far from reality, because as I said before, this is a very illiquid market and the risk of slippage is very high.
Alright, so let's move on to the next strategy, which is similar to the one that we have just seen.
But unlike the first strategy we saw earlier, this strategy won’t enter on the highs or lows of the current session but will look for breakouts in a price channel where we will enter long on the upper channel and instead enter short obviously on the lower channel.
This channel is built on the highs and lows of the last 180 bars.
In this case, these are 5-minute bars, but if you prefer, you can use slightly wider bars, such as 15 or even 30 minutes.
As I mentioned earlier, this is a trend-following strategy, and you’ll close your positions at the end of the session.
Specifically, we see the short side, if a take profit or possibly a stop loss does not occur, we can see it here.
Here’s the time exit. It closes at 12:30, while on the other hand, the long side, for example, we can see here, the time exit "time LX" closes practically on the last bar of the session.
This is because the market is trying to follow the underlying behavior of this market, namely, in the morning, in the overnight hours, there is a tendency to go down, while instead in the afternoon, there’s a tendency to rebound.
Of course, that doesn't mean that this will happen every single day.
Indeed, there are also stop losses.
But here we can say that the market respects these movements on average.
In 2023, this strategy hasn’t worked yet, but it only has just started a few days ago.
Those are days, by the way, where the volatility and the volumes are not very high, so we’ll see what 2023 does have in store for us with this kind of strategy.
Let's go through the report. We’ve considered the costs of this strategy, which are well over $82,000.
That's because this is a strategy that trades more... you’re looking at 1665 trades since 2010 with an Average trade actually similar to the previous strategy. Indeed, as I told you, they are pretty identical strategies.
This strategy is out of sample from 2017, so we could say from that period.
You can see that even in the post-development period, even though it’s been, let’s say, burdened by the costs that we would have incurred in applying these strategies to this market, this system has remained in really good shape, with peaks after peaks over time.
So, guys, give it a try as well. I do hope that you enjoyed the video.
If anyone among you is interested in the world of systematic trading, I recommend you go and click on the link in the description of this video. From there you can watch a free presentation by Andrea Unger, you can go and get our best-selling book "The Unger Method" which includes the strategy that you just saw by… all you need to do is just cover the shipping costs to get it to you, or even book a free call with a member of our team.
If you enjoyed the video, please remember to leave us a Like, subscribe to our channel, and click on the notification bell so that you can stay up to date.
And with that, we will see you soon in our next video! Bye bye for now!
We'll help you map out a plan to fix the problems in your trading and get you to the next level. Answer a few questions on our application and then choose a time that works for you.
BOOK YOUR FREE STRATEGY SESSION NOW >>Andrea Unger here and I help retail traders to improve their trading, scientifically. I went from being a cog in the machine in a multinational company to the only 4-Time World Trading Champion in a little more than 10 years.
I've been a professional trader since 2001 and in 2008 I became World Champion using just 4 automated trading systems.
In 2015 I founded Unger Academy, where I teach my method of developing effecting trading strategies: a scientific, replicable and universal method, based on numbers and statistics, not hunches, which led me and my students to become Champions again and again.
Now I'm here to help you learn how to develop your own strategies, autonomously. This channel will help you improve your trading, know the markets better, and apply the scientific method to financial markets.
Becoming a trader is harder than you think, but if you have passion, will, and sufficient capital, you'll learn how to code and develop effective strategies, manage risk, and diversify a portfolio of trading systems to greatly improve your chances of becoming successful.
