FXI gapped up today by almost $3 and as it approached $180 I felt it was way overbought.
So I sold 300 shares FXI short at $179.75 on the thought that the gap up would get filled. My target was $179.
I was somewhat correct in my thinking...but I panicked when the FXI shot up to over$180.50 in the next 9 minutes. I got out at the WORST price possible, $180.65. LOSING $270
If I had been patient and let the trade develop this trade quickly turned into a GAIN by 11:30am. At 11:15am the trade had already come off the high ($180.65) and turned down FAST. If I had waited 12 more minutes I would have hit my target!
LESSONS LEARNED:
1. I should have placed a stop at $180 to limit my loss to $75
2. I could have been more patient and let the trade develop, turning the loss into a gain. My instinct was correct, I just needed to let it play out.
3. This was clearly a short squeeze by the big players. I got caught in it and I panicked.
4. I made a contribution to my trading tuition. :-(
UPDATE:
To add insult to injury my computer crashed as I was making this blog entry. WTF!!
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