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Why I Will Be Trying A Short WTI Position Again

Rigs

I am lucky enough to have a small group of dedicated people to whom I teach some of the lessons learned in my time in dealing rooms around the world and there is a mantra that I often repeat to my students…Only losers average losers. It was drummed into me by my first boss early in my career in forex, and was his way of saying that if you get a trade wrong, just accept it and move on. Averaging a losing position may often look tempting; I mean if you liked it at 40 you must love it at 10, right? The problem is, though, that the reason you loved it at 40 obviously haven’t panned out, which is why it is at 10. Buying more may give you a better average of 25, but it also gives you a larger wrong position, and that is hardly ever a good idea.

It is with some trepidation then that I effectively “double down” on my opinion that what has become known as the “OPEC agreement” is actually no such thing, and that the rise in oil prices that has accompanied it is, above all else, a good opportunity to sell. That isn’t to say that I am, nor should you be, doubling down on any positions. Any short position I may have had following the initial surge in price immediately after the news was cut a long time ago as the price continued going up. What it does mean, though, is that I am prepared to go to the well one more time.

Ironically, the reason I am looking to short WTI again as we edge closer to June’s $51.75 high is also connected…

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