There was a question in another post about Crude Oil and my reply involved Heating Oil, so here is how that chart looks. We see the longer term trend indicator still in a down position but getting close to breaking upward. The shorter term indicator has far outraced price as indicated by the red arrows on the chart. This could be a situation where the market has punched itself out on this bounce and we resume a downward move. However, it does appear to me that if we rally through this area here, most of what I watch will have turned upward, and the trend will then be up. I have orders in to short this market below Friday's low as indicated by the red arrow on the chart. This is heating oil, but crude oil trades along side of it, and they do move together. I selected Heating Oil simply because of another filter I use that I do not discuss in here that tells me if we turn down the probability is a little better there than in Crude. After today I do not know if this sell setup will still be here, so it needs to trigger today. The energy markets appear to be back in sync with equities so unless we get a stock market decline today, this trade will not likely be filled.
A reader asked me a question about how to manage his current Crude Oil short. My answer may have come across a little mixed. The point I always try to make with anyone is that you have to have your exit strategy determined before entering any trade. I know exactly where my stop loss is for the above trade, it will be above Friday's high if my short order is elected. The minute I get filled, I will place the stop. If the trade moves in my favor, I will move it down according to an exact plan until it is either hit or my profit objective is reached. That part of trading should be very simple. If you get yourself into deciding these things after you are already in, emotion will get the best of you, and you will make poor decisions.
Since the reader entered at the market ( not what I do ) vs on weakness ( how I enter ), it is hard for me to tell him or her how to get out, because they are in a trade I would not be in. However, if you have an area where you think if price gets there you are wrong, then that is where your stop should be.
I am very short on time this morning, I will make up for my lack of content tomorrow. I went to Lake Havasu at the end of last week which is why I did not post anything for 2 days, chillin in 117 degrees!