Oil has had trouble sustaining a move above the 50 handle. IF and when it does, the 60 handle looks to be the next level of supply.
What to do?
If you are long and have a lead, my belief is to hold as long as you can. IF it does break to the upside, there is another 20% that you would not have if you took profits at these levels. As Jesse Livermore said, "It is the big swing that makes the big money"
If you are looking to get short, I would have a tight stop above this week's high print. You do not want to eat a squeeze to 60 level.
As always, my checklist:
Is this trade worth taking?
* Where is the R/R right now?
* Is the market trending or ranging in the time frame you are watching? If trending, trending which way?
* Is price currently at a level that is obvious to all market participants? Remember, it is their orders that will push your trade to profit or loss. What are other traders seeing?
* What is the price action? Is it obvious?
If the answer is yes to all three questions, take the trade.
If two of the answers are yes, use your best judgment.
If only one of the answers is yes, pass on the trade.
There are exceptions, know when to use them.
Executing a trade
* Check if there are any major economic events within the next 24 hours.
* Make sure the position is sized correctly when entering the amount.
* Make sure the stop is in place before the order is executed.
* Make a notation in your spreadsheet about why you took the trade, targets, stops, etc.
End of day
* Make sure stops on open positions are correct. Adjust as needed.
* Execute new trades.
OVER THE LONG TERM, THE WAY TO WIN IS TO HOLD ONTO YOUR WINNERS, AND CUT YOUR LOSERS. IT IS AS SIMPLE AND AS HARD AS THAT.