The oil trade I recommended yesterday was stopped out at $49.60 which was a $400 loss per contract. This trade had everything I like to see when taking on a position except for the sentiment readings. The failure hold what I thought might be a mid cycle low has told me that we may very well be getting a failed daily cycle.
A failed daily cycle will take out the previous cycle low at $47. Daily cycles run from 30-50 days on average. The fact that this cycle peaked at day 13 which is not half way through the cycle tells me that this is a left translated cycle which are bearish. We are now at day 20, so I suspect we still have 2 more weeks to go before oil finds a bottom.
I won't be interested in touching oil again for at least 2 weeks. I would like to see a very scary drop that will indeed mark the yearly cycle low and cleans the market of any bullish sentiment. At that point, I will probably give this another try.