Trading Journal: Exited GLNG And OIH Positions

The past week price action has played a trick on me and I has exited my bearish positions in Golar LNG (GLNG) and Market Vectors Oil Services ETF (OIH) earlier than I should.


I, initially, entered a bearish position in GLNG following a Triple Bottom sell signal (pink box) on Mar 21. The first rebound to the 37.2 level in March was in boundaries of the descending trendchannel and I expected the next leg down to fall to the 34.2 level and generate a strong Bearish Catapult sell signal. The price, however, made the second rebound and broke out of limits of the declining trendchannel.


We can see it clearer on the shorter horizon 0.3x3 60 min chart. The last two rebounds built higher columns of Xs than all previous retracements within this leg down since February signaling about the increasing bullish pressure. The overall picture looked like the decline from February is about to reverse or enter a new trading range. At least, I came to this conclusion analyzing charts over the weekend and decided to exit the position if the price comes closer to the lower border of the new horizontal range as momentum was still down. I did exactly that when the price fell to 35 on the oversold intraday conditions. Needless to say that later in the day GLNG fell even lower generating a new Triple Bottom signal. Am I disappointed that I didn't stay in the trade a bit longer? Of course, I am. However, I followed the plan I thought through before a trading session. My weekend analysis showed that the price behavior is changing and the probability of a break down is decreasing and that it’s better to step away until the picture becomes clearer. I am disappointed that I got it wrong but feel good that I followed my plan.


The similar situation has occurred with my OIH trade. A Quadruple Bottom sell signal (pink box) was the reason to open a bearish position. The following column of Xs penetrated deep into the congestion pattern and stopped just 10 cents short from my stop casting doubt on the breakdown validity. I exited the OIH trade when the price fell to the 41 support level.

Sold to close GLNG May13 35 Put 20 contracts at $1.00
Sold to close OIH May13 42 Put 10 contracts at $1.70

Disclaimer: I express only my personal opinion on the market and do not provide any trading or financial advice (see Disclaimer on my site).