Crude Oil

Wednesday  21 September 2016

Stopped out at price, 43.18

16 Sep – Buy 43.88
19 Sep – Sell 43.18

Loss = 70 tics, $700 plus $15 commission per contract

This trade recommendation was similar to soybeans in triggering
the trade.  The outcome is similar to the copper trade of a week ago
when the trade turned into a loss only to have the market recover
immediately thereafter.

The basis for entry in these trades has been very similar and all
in accordance with rules, not sentiment or guessing.  There is no
way to know the outcome in any given trade.  While both copper
and now crude oil resulted in an initial loss, the price action
proved the trade selection valid, however, the stop losses were
elected for a loss prior to the price turnaround.

Whether this is a result of high frequency-type stop hunting or
not cannot be known, but the trade selections have had a higher
probability degree of success than of late.  We cannot operate
without stops and “hope” for a turnaround as was seen in copper
and crude oil.  We are looking for ways to not get caught in these
kinds of results that should lead to profit and not loss.

We are opting out of the soy bean trade, locking in a $1,000
profit on a half-position, which has been our practice.  Were it
not for the crude trade, we would have let the bean trade last a
while longer, only because Chicago markets are a little more
stop-“honest” than New York markets.

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