This morning before the open I was looking at April Lean Hogs chart. (The chart shown above is after the close.) I was looking at the consolidation between Nov 20th and Dec 12th. I kept having the thought that we are right in the middle of that zone as well as the 76.4/78.6 Fib retracement level, and that we could well have a bounce from here before hitting the 72 target.
The need to protect my position kept growing until finally I added a stop loss to the Put option. Then I posted this comment to yesterday's post in case anyone needed to know:
"I tightened my stop at 9am 1/14/20 before the hog market opens to 73.94"
Well, as you can see by today's chart, the stop loss was hit and I got out with $20 gain. Good thing because today's high was 75.30 and the close was 75.00.
However, notice today's candle closed right on the 8ema. So, by the way I trade, the down trend hasn't yet ended because we didn't close over the 8ema. But today's candle combined with yesterday's candle forms a Bullish Engulfing pattern, which is bullish. And stochastics are still oversold.
So, I decided to just stay out of the Lean Hogs market for now and see how it develops.
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