I’ll start by saying my covering of AMD couldn’t have gone much worse. I had a short position, and in spite of AMD being quite a large company, its pre-market market prices were up about 36% (AKA not a good morning to be short). I am very disciplined in my trading, and my stop-loss orders are always in place. On extremely rare occasions I’ll temporarily remove such orders, but this time I kept it in place and basically got out at the worst possible price.
In retrospect (although a couple of hours isn’t much retrospection!) if I had been feeling less crushed by the huge pop in shares, I would have actually shorted MORE, because the mega-rally hit an important resistance level by way of a very long-term trendline.
Here’s a multi-decade view, illustrating my point better.
I strongly suspect today will be a high-water mark for AMD for a while. I further suspect it will at LEAST sink back down to almost 170 to close its price gap. I finally suspect I’ll be kicking myself every step of the way, but honestly, staying short something which begins the day up 36% just doesn’t work for me.
