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MARKET – RED ALERT
When stocks across all sectors go into the red zone for more than a day or two and gold on the COMEX goes from 1820 to 1920 in a couple of sessions – fear has settled in the hearts of investors. In an era of Uranus, Cryptocurrency and clean air trading, self-preservation instincts compel a trembling hand to send orders to buy stocks of companies that mine gold. Take a look at the weekly cross-section of the stock market on the planet – RED ALERT. In the green zone, only companies in Canada and Africa, which produce gold, and pharma. When you’re scared – you buy pills at any price.…
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EURO – Deadline ⛱
The March contract will lose its liquidity by the end of the week and become history. In fact, it is possible to summarise the results, plus it is doubly enjoyable to do so for the March contract. Why? The end of this contract means that spring is just outside the window. Slide#1 – indicators, bar charts and data types are marked on it as well as the volume core of the contract and the second most important range. Also take note of the VWAP price and that the current contract remains within the 2 deviation. Open interest is already signalling that participants are dumping their positions and have started to open them on…
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How the world’s biggest oil trader makes his billions – Vitol Group. Part 6
Vitol became vertically integrated, which would allow it to minimise investment in and dependence on actual oil production. He says: “I would kill – kill! – for such a system”. Although setting up such a structure would be costly, Taylor and his colleagues want to remain a private company at all costs. Glencore’s initial public offering in 2011, which resulted in several “billionaires on paper” on the same day, did not entice Taylor or his team, he says. At least, that is the case now. Bob Finch, a former top manager at Vitol who has been its largest shareholder for many years, says the company considered hiring a bank about…
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How the world’s biggest oil trader makes his billions – Vitol Group. Part 5
Instead of paying a fine by refusing to admit guilt, Vitol agreed to a plea bargain in New York State Supreme Court. Other companies, including Chevron, were going through similar civil and criminal proceedings at the time, but few pleaded guilty. Taylor says: “We went to this to protect our own staff” He believes that otherwise prosecutors could have charged individual traders. Another storm erupted around the company in 2012, when Vitol purchased Iranian oil to circumvent US and EU sanctions. Vitol, which used its subsidiary in Bahrain for the deal, denied guilt. Nevertheless, this episode was a watershed for the company. After suffering negative reactions from CIM and some…
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Standard and Poor’s 500
ES Period: 15/12/2022 – 16/02/2023 TF: Day Chart: Volume Profile Add: Indicator VWAP + dev1/dev-1 Add: OI indicator Total Histogram: Volume Delta I made my first trades on an e-mini S&P 500 futures contract. Even though it was a long time ago, even now I remember the emotion I felt at the time. The volatility of the index in 2007 was quite different. If you could take a trade with an open-close price difference of 5 dollars – it was like winning the lottery. I can’t remember whose words, but the phrase is “The most valuable thing we have are our memories”. Let’s move on to a review of the S&P 500…
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How the world’s biggest oil trader makes his billions – Vitol Group. Part 4
For Vitol, oil is just the beginning. The company mixes different types of fuel to obtain a product of exactly the right quality for a particular region, customer or even season. To guarantee an uninterrupted supply, Vitol pays in advance to companies such as Russia’s Rosneft, or to entire governments, such as the oil-rich Kurdistan Region in northern Iraq. Having sold this oil, it will recoup all its costs a hundredfold. Craig Pirrong, professor of economics and finance at the University of Houston, says that while Vitol is perceived as a speculator, the company actually acts as a middleman. It turns supertankers into floating oil storage tanks, carefully timing the…
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How the world’s biggest oil trader makes his billions – Vitol Group. Part 3
Vitol in its current form began taking shape in 1990, when Dettinger and seven other partners sold the company for between $100m and $200m (the actual figures have not been disclosed) to a team of around 40 employees, including Taylor. The buyout was financed by Dutch bank ABN and former trader Tom Wonk took over as CEO. Since then, no single shareholder has controlled more than 5% of the company – Taylor and his team call this the “we culture” and claim it has been the cornerstone of Vitol’s success. Bake says: “If someone thinks they are bigger or better than all of us together, sooner or later they will…
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How the world’s biggest oil trader makes his billions – Vitol Group. Part 2
Vitol has not had a single loss-making year in its half-century history (the company will celebrate its 50th anniversary in August). According to Bloomberg Markets, its profits have risen from $22.9m in 1995 to a record $2.28bn in 2009. At its peak, Vitol’s return on equity was an unthinkable 56%. Even Wall Street pales next to such success: Goldman Sachs’ peak return on equity since its IPO in 1999 was 31%. Jean-François Lambert, who worked extensively with the company as head of global commodity markets and structured trade finance at HSBC, says: “Vitol has established itself as an energy trader at its most extreme. Journalists traced the history of Vitol’s…
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How the world’s biggest oil trader makes his billions – Vitol Group. Part 1
Taylor, chief executive of the Vitol Group, the world’s largest independent oil trader, caught himself thinking he would like to see a full-fledged jet fighter in the place of the drone accompanying him. The head of Vitol, Ian Taylor It was early 2011. Rebels opposed to Colonel Muammar Gaddafi’s 42-year dictatorship had just taken control of the city and appointed their own government. A meeting with this motley group of former military officials and local politicians was arranged surprisingly quickly, but Taylor realised that if anyone could make a deal with them, it would be Vitol. A few weeks ago, one of its top managers in Dubai, Christopher Baik, received…
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Petroleum
CL TF: Day Chart: market profile – range day – open/close Indicator VWAP + dev1/dev-1 Total Histogram (price/tf) Volume/Delta The specification and volatility of the CL futures contract is what led me to speculate on black gold. I won’t be trading CL this week and there are several reasons for that. Volatility is probably the most important thing about CL. Making good profits without waiting days for the required target is what’s stopping me from leaving the oil trading clan. The VWAP channel is already pointing to a narrowing of volatility and for good reason. This week is a holiday in the USA, Saudi Arabia and towards the end of…
