Well, that was a total abomination!
We went short yesterday on IBM at $174.22. And just look at what happened. The shares of IBM surged by $10. You can see the huge candlestick today proceeded by a gap of more than three dollars. Of all the days of the year I picked that day to go short. It could be years before IBM goes up $10 again in a single day. The worst thing is that as I explained in a previous update the stock gapped up past our stop.
You can see what happened better on the intraday chart in the fifteen minute time period. We had our stop set at $176.66, but as you can see the shares opened up at $178.65. So, our stop was missed. Then I tried to get cute and move the stop up to $182.75. That time to stop got hit. In all we lost $8.53 on position. The only good thing that we had going was that we were only short by 25 shares.
Now I would consider going long on IBM if it stays above $185, but I don't trust that $3.37 gap. Typically gapped like that get filled.
Well enough of that, we are out and I for one do not want to see IBM for while.
Sell 1/4 IBM at $174.22
Buy 1/4 IBM @ $182.75