Lesson Learned: Over-leveraging on Crude Oil Futures
Thought I'd share a quick reflection on a mistake from a few years back that still sticks with me. It was during a period of decent volatility in crude oil futures, and I'd had a string of moderate successes. Started to feel a bit too comfortable, which is always the precursor to trouble.
I saw what looked like a clear breakout setup on $CL_F after a period of consolidation. The problem wasn't necessarily the setup itself, but my sizing. Instead of sticking to my usual risk parameters, I effectively doubled down, convinced this was 'the one'. My stop was logically placed, but the position size meant that if it hit, it would wipe out a significant chunk of prior gains. Naturally, it did. The market faked out, tagged my stop, then reversed in the direction I initially anticipated. The sting wasn't just the monetary loss, but the complete disregard for my own risk management rules. It was a classic case of greed overriding discipline. The lesson was sharp and effective: consistency in position sizing, regardless of how 'sure' a trade feels, is non-negotiable. Emotional conviction has no place in the sizing algorithm.