Tightening Stops on Synthetic Oil

The synthetic oil position which I recommended very early yesterday (I worked on it until 1:30 yesterday morning) is up pretty good today.  If you took the position yesterday afternoon, you probably got an even better fill than the one I posted at $48.  Oil is up 3% today as I write this at $49.25. 

​When I recommended the trade, I had a very loose stop placed at $46.90.  I am being cautious here, but I am recommending increasing this stop to just below yesterday's low at $47.60.    $49.5 will be the first resistance area oil meets.  Should oil break through this level, the next resistance will be at $52.5 at the 200 day moving average.

When I recommended the trade, my enthusiasm was somewhat muted due to higher sentiment than I really wanted.  I wanted this trade in case I was wrong and we were beginning a new intermediate cycle because the gains can be so big.  Moving the stop to $47.60 limits the loss to $400 should I be wrong. 

​What I am leery of is that the market could hit resistance and trapped longs take advantage and sell, pushing prices lower.  There is a lot of overhead resistance in oil right here, going back to the August low.  What I don't want to happen is that oil bounces lower off this resistance and drop to last summers low around $46. 

When/if oil hits $50, I plan to increase stops again locking in some gains.  Again, if the market is moving into a new yearly cycle, prices out of this daily cycle should reach $56.  That will be an $8,000 gain per oil contract.