Last Updated on 14 October, 2021 by Samuelsson

(HO) Heating Oil Trading Strategy

This edge in the HO futures market has worked well for several years, with the exact parameter settings as showed in this post!

Edge Details


 Heating Oil




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Heating Oil Trading Strategy (HO) - Fantastic Edge in Using Trend Strength

Profit Factor: 1.89

Avg. Trade: $440

Win Percent: 58%

Trades: 725

A Closer Look

The Heating Oil market suits traders who wish to diversify from the most common markets. As we show with this edge, it offers strong tendencies that can be utilized to build strategies.

This edge has only one(!) condition for the entry. This gives quite some room for further improvements!

The edge is composed of:

  1. A simple Price Pattern
  2. A Trend based Exit

All edges come with open Tradestation code in Easy language. An ELD file and workspace.

1. A Simple Price Pattern

The entry logic uses a very simple price pattern, which in itself is only one condition. Still, it’s enough to produce a beautiful equity graph!

2. A Trend Based Exit

This is the second condition of the whole edge. We use the trend strength to find the optimal exit point!

Improving the Edge

This edge has already proven itself for a few years, but I thought that I might try to improve this simple logic further. Since the strategy only consists of two conditions, I feel comfortable adding more filters.

This is the result I got from adding one very simple filter to the long side of the edge. The filter is one that makes sense intuitively. That’s the reason why I believe it will hold also going forward!

Here is the equity graph. Transactional costs are included!

Heating Oil Edge

Heating Oil Edge

Try to add filters and experiment with different logics! There certainly can be built great strategies with this edge!

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