Lesson Learned: The Cost of Chasing Gaps
Watching the open today reminds me of a specific instance from a few months back with $TSLA. It gapped up significantly pre-market on some delivery news, and I had a decent chunk of dry powder sitting idle. Instead of waiting for consolidation or a clear entry signal, I FOMO'd hard right at the open, convinced it was going to run straight to the moon. Bought a decent chunk, watched it churn sideways for about 30 minutes, then slowly roll over. My stop was hit for a quick 2R loss, which wasn't huge in isolation, but the opportunity cost of that capital tied up and then lost, all for a completely avoidable entry error, still stings. It's a classic example of letting the initial excitement cloud a rational read of price action. Now, I refuse to chase those morning gaps; I'll wait for the market to decide if it wants to hold that new range.
Ah, the siren song of a gap-up. It's a classic setup for buying high and watching it retrace, isn't it? At least you're not alone in that particular tuition payment.