Oil is the most popular commodity among traders. With a constant supply and demand, liquidity is rarely hard to find and volatility as almost as high as in bitcoin.
Virtuse Exchange is a bridge between traditional assets and new crypto markets. Our platform allows investors to trade crypto and crude oil, all from a single, multi-asset account, without the need to convert to fiat.
Now you can buy and sell crypto oil seamlessly and hold it on your private keys.
Virtuse Exchange leverages Digital Asset Collateralized Contracts (DACCs), a model that allows converting your cryptocurrencies into commodities, without having to move money from one wallet to another. The DACCs act rather like a stablecoin whose value can be pegged with a reliable price feed to the value of USD.
To trade on oil prices with Virtuse Exchange, you’ll need to open an account. It takes a matter of minutes, can be done entirely online, and there’s no obligation to fund once you’ve finished your application.
However, you will need to fund before you place your first trade. Funding a wallet account is simple. You can send USD or crypto to your wallet a you’re ready to go.
A trending market is one that is consistently making new price extremes. For example, an up-trend can be seen by identifying a series of higher highs and higher lows. A down-trend market is identified with a series of lower highs and lower lows.
Trading silver can be made easier when you understand the benefits of trend following. There are different techniques to determine the direction of a trend like drawing trend lines or using moving averages. You can take advantage of the volatility to earn huge profits. Just look at the chart of gold and you realize that this might be the best timing.
A range trading strategy is used when a market is in consolidation, meaning during a period when markets tend to be range-bound.
The oil market does not always trend upwards or downwards, it often enters periods of consolidation when the prices move ‘sideways’. This is not bad news for traders as there is a strategy to trade markets in consolidation. How does it work? First determine the range, then filter your signals and finally execute the trades, but don’t forget to set stop-losses and take-profits.
Oil has its own price drivers that you’ll need to watch when trading. Dollar, inflation and financial or political crises are among the major ones to follow. But there is more. Oil price is influenced by the level of demand which is related directly by the prospect of global economic activity. The expected supply is linked with any war-related disruptions from the Middle-East and elsewhere, and the likelihood of OPEC members curbing their production.
Oil is predominantly traded in the paper form as oil futures, which are contracts in which you agree to exchange a set amount of oil at a set price on a set date. Unfortunately, these contracts are traded on large futures exchanges, which are accessible only to large institutions.
While oil importers and exporters use futures to insure against the adverse effects of oil price volatility, you can use them to speculate on oil without buying or selling the commodity itself. That’s because the prices of oil futures will move as the value of oil goes up or down.
Unlike futures, which show prices at a set date in the future, oil spot prices show the cost of buying or selling oil and taking delivery immediately, or on the spot. So while futures prices reflect the prediction of oil prices in the future, spot prices show how much it is worth right now.
Crude oil is petroleum that is acquired directly from the ground. Crude oil was formed millions of years ago from the remains of tiny aquatic plants and animals that lived in ancient seas. Ancient societies such as the Persians, 10th century Sumatrans, and pre-Columbian Indians believed that crude oil had medicinal benefits. Around 4,000 BC in Mesopotamia, bitumen, a tarry crude, was used as caulking for ships, as a setting for jewels and mosaics, and as an adhesive to secure weapon handles. The walls of Babylon and the famed pyramids were held together with bitumen, and Egyptians used it for embalming. During the 19th century in America, an oil find was often met with dismay. Pioneers who dug wells to find water or brine, were disappointed when they struck oil. It wasn’t until 1854, with the invention of the kerosene lamp, that the first large-scale demand for petroleum emerged. Crude oil is a relatively abundant commodity. The world has produced approximately 650 billion barrels of oil, but another trillion barrels of proved reserves have yet to be extracted. Crude oil was the world’s first trillion-dollar industry and accounts for the single largest product in world trade.
Futures and options on crude oil trade at the CME Group and at the International Petroleum Exchange in London (IPE). The CME trades two main types of crude oil: light sweet crude oil and Brent crude oil. The light sweet futures contract calls for the delivery of 1,000 barrels of crude oil in Cushing, Oklahoma. Light sweet crude is preferred by refiners because of its low sulfur content and relatively high yields of high-value products such as gasoline, diesel fuel, heating oil, and jet fuel. The Brent blend crude is based on a light, sweet North Sea crude oil. Brent blend crude production is approximately 500,000 barrels per day and is shipped from Sullom Voe in the Shetland Islands.
The world’s largest oil producers in 2017 were Russia with 13.1% of the world production, Saudi Arabia with 12.5%, the United States with 11.5%, Iran & Iraq each with 5.5%, and Canada with 4.9%. U.S. crude oil production in 2017 rose by +5.0% yr/yr to 9.301 million barrels per day. Alaskan production in 2017 rose by +1.0% yr/yr to 494,656 barrels per day and was far below the peak level of 2.017 million barrels per day seen in 1988.