USO / SCO Update

If I liked SCO (2x leveraged short crude oil) yesterday, than I like it even more today, especially because the pullback today in SCO is all EURO or more specifically Euro/Dollar based.

The charts...

 USO in green (5 min chart) vs the Euro in red, USO is simply following the Euro/Dollar correlation.


 This is the 5th, 6th, 7th, (?) time the Euro has broken above $1.30 this week, it hasn't been able to hold it, I don't think it will yet.

 USO 2 min intraday with ZERO confirmation of the move this morning, in fact it looks worse than yesterday.

 USO 5 min chart also looks worse than yesterday, this isn't a position trade, it's a short term trade and that's why a leveraged ETF was chosen as the vehicle.

 Here's Crude Futures this morning, also not looking good here.

 Here's SCO 5 min, looking better today than yesterday, I'm guessing smart money is seeing this in the same light I'm seeing it, as an opportunity.

SCO 10 min also looking good, I wouldn't go much beyond this, don't forget what kind of trade it is, you don't take a swing trade and try to force it to be a trend trade so your risk management and position sizing should reflect the same, you don't go all in on a shorter term trade in the manner in which you would take a larger position with a longer term position trade.

Adjust the risk to the opportunity, use the right tool for the job.

That being said, the SCO position from yesterday is down less than a percent, I feel that I could add a little here and not violate the concepts above.