Sometimes, even when you are making great money on a trade it can still be frustrating...
Even a Good Trade Can Be Frustrating Sometimes! Sometimes, even when you are making great money on a trade it can still be frustrating. That is what is happening right now in the long crude trade that I sent out last week. My initial idea was to take a profit in the high $69s and, apart from one quick blip up to 69.64 on Sunday night when not even I was actively trading, we seem to have hit a brick wall just below that target, somewhere around 69.35. Now, after a drop early this morning, we are back down to around 68.50. That represents a profit of well over $1000 per contract in CL, which would normally be a very nice return but, in the circumstances, is a bit frustrating. However, at this point, the most important thing is not to allow that frustration to make me do something stupid. I am really, really tempted to leave things as they are, even though there is an OPEC+ meeting tomorrow, but I am going to make a few adjustments. The thing is, as I said in yesterday's Deep Earth email, I don't really see any circumstances in which the group says it was wrong when it set new targets last month, so an announcement that causes a big drop in crude looks very unlikely. There is still, however, a slight chance of something mildly bullish, such as saying that the Delta variant means that reductions to the current targeted output are possible in the future. In some ways, that would be a smart thing for the oil ministers involved to do because it would push oil higher, without actually reducing output. That's why I want to stay long, but the one thing we know about OPEC from the past is that the only predictable thing about the cartel is that they are unpredictable. So, rather than see all the profit disappear, I am going to readjust the stop to lock in some money. |
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The obvious place to put that revised stop would be just below this morning's low of 68.16, but that is close enough to the round number to make me allow for the possibility of a failed test of 68 and set it at 67.90. If we grind back up above $69 from here, I will probably take a profit but the possibility of some news that prompts a quick run up makes me reluctant to just set an order, so I will be manually watching it. If you have the same position, in futures or the ETF, you should do the same because, if things do start to jump around, I probably won't be able to get an email out in a timely manner to suggest a level to cut. Good Luck! Cheers, M |
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