All traders must know what their risk will be on all trades – no guessing is allowed. Not all trades can be winners, so one must know when to cut bait. Sadly, today was one of those days.
With weakness on many time frames, a sell signal was issued early for Schlumberger (SLB). Unfortunately, the moment that that signal was issued, the market bullishness was really just starting. Seemingly at that very second, SLB exploded higher. The indices’ staggering march upward and the ~ 2% gain in oil futures certainly hurt this trade position. Shockingly, there were no pullbacks, or even sideways “rest” periods; the markets kept marching higher all day long. Shocking, indeed.
Losing is no fun, but it is also a reality of trading. So let’s keep the losers to a minimum and let the winners run!