Using Hedges During The Crude Oil Rise

Still bullish crude, prudent to hedge. A live-documented USO put trade that went free in two hours. Updated live

📌Note on this Post:
I'm writing this live, as the trade happens. Not a recap written after the fact with the benefit of hindsight... you'll see the timestamps inside every screenshot, and my thoughts as they existed at that moment. What I saw, what I did, and why. The idea is see how I’m thinking about this hedge as September /CL futures pull back after it’s rise from $67 to $93

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Quick backstory first.

When /CL started forming a base and rallying out of the 60’s, I started buying. But nothing goes straight up... especially in commodities.

We already saw this movie once this cycle. Crude launched from ~60 to 95 March thru May, then gave it right back to 67. If you traded CL through that, you remember.

So with this latest move in CL (using USO here), I wanted to consider a few things...

4 Hr chart:

• 81 on RSI

• Parabolic move into upper resistance ~ 141-145

• Multiple gaps below. Most gaps get filled

• ATR expanding, sitting at 3.152

• 78.6% fib retracement of the move down right at ~142

Yesterday afternoon USO broke into the upper resistance channel and I bought protection…

More specially I bought these ⬇️