Take a look at the five-day chart of IBM. Notice that big gap up this morning. The problem with our trade is that the stop was set at $176.66. As you can see the low of today is $178.65. So, the stop was never hit and we are still in the trade. When I am waiting for now is a stock to drift down before manually entering a buy to cover order.
This has happened to us before, it's no biggie. We are only short 25 shares leaving us about $200 in the red if we get out now. I don't want to take a $200 loss. You have to decide for yourself, you can get out here, now. But I think the thing to do is to put the stop at $182.75 and see what happens. I would expect the gap that big to eventually fill before IBM continues upward. The final hour of trading should provide some guidance.
So, we will put the stop at $182.75 for protection, but wait to see if we can cover closer to $180 later today.
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