#SPX #bearcallspreads Playing this rally…

#SPX #bearcallspreads

Playing this rally as a DCB:
STO SPX August 26th 2022 4125/4150 BECS @ 10.50


My indicators show that SPY has entered a new uptrend. Even though it’s pretty weak, I’m following the system.

STO SPY April 22 2022 433 Put @ 2.11

#spy #shortputs

Market Awareness

#spx #market #spy

I don’t trade based on this indicator, but I know it is widely followed so I thought I would post for anyone interested. SPY’s 50-Day MA has been dropping relative to its 200-Day MA at about the rate of $1 a day. Since the spread is about $5 now, the famous (or infamous) “death cross” will occur around Monday or Tuesday barring any major changes.

Powell Testimony Today & Tomorrow

For anyone who wants to watch, it starts at 10:00 AM Eastern:

Market Timing Awareness


I just wanted to post this today, because this market timing model is based on ignoring intra-month noise and only checking the signal at the close of the month (today). That way, it avoids a lot of the whipsaws that plague many timing systems, at the expense of being slower acting. Barring any massive rallies, it looks like it will flip to bearish at the close today.

Basically, it holds either SPY or IEF, based on whether SPY is above its 200-Day MA at the close of the month. I used the similar Vanguard mutual funds to be able to extend the backtest (below).

Here it is:


SPY Timing

Feel free to use or ignore. I just thought it might help give an overview of where the market is right now.

SPY Put Ladder

#takingprofits #spyladder #shortputs – As I posted last Friday, if SPY were to close today below its 50-Wk MA (438.95), I planned to exit my open puts and wait on the sidelines until a new uptrend takes shape. I’m skeptical that SPY will get there by the close and stay there, so I went ahead and took advantage of the rally to close all open puts:

BTC SPY March 4 2022 409 Put @ 1.20 (sold for 2.20)
BTC SPY March 4 2022 408 Put @ 0.95 (sold for 2.20)

If SPY does manage to close today above the MA, I’ll assume we’re still in an uptrend and resell on any weakness next week.

SPY Put Ladder

#spyladder #shortputs – Closed most open positions on the bounce to control risk. Then, at the close, sold OTM put for 2 weeks out. Only current open option position:

STO Mar 4 2022 408 Put @ 2.20

Today is the first weekly close below the 50-Wk MA since the week of 6/22/2020. If we get a second consecutive close below that MA next Friday, as they say on Shark Tank, “I’m out.” I’ll close the open short put at the close and wait until SPY proves that it is ready to launch a new uptrend.

If, on the other hand, SPY closes above the MA, I’ll keep the open put and sell another one for 2 weeks after that.

(Edit) Forgot about another account:
STO March 4 2022 409 Put @ 2.20

SPY Covered Strangles

#CoveredStrangles #ShortPuts – Pre-selling to setup future covered strangles:

STO Feb 22 2022 438 Put @ 4.50
STO Mar 4 2022 438 Put @ 8.25

Both are at the 50-Wk MA.

Edit – added another one:

STO Feb 25 2022 438 Put @ 6.50


#spyladder #coveredstrangle – Added a short put down at the 50-Wk MA, 2DTE, to go with the covered call:
STO SPY 18 March 2022 438 Put @ 2.20


#spyladder #coveredcall – Only 2 days to expiration:
STO SPY Covered Call – Stock @ 444.12 with March 18 2022 450 Covered Call @ 1.31

SPY Ladder

#shortputs #spyladder – Still reducing risk. Gradually adjusting to selling nearer expirations hoping to be more nimble.
BTC SPY March 31 2022 440 Put for 12.15 (Sold for 14.50).

Literally went to Wal Mart and spent some of the money on beer. Lol!

SPY Put Ladder

#spyladder #shortputs – Reducing risk by shortening the expirations of my SPY puts and lowering the strikes.

BTC SPY April 11 2022 440 Put for 11.10 (Sold for 11.15)

GTC order open:
STO SPY Feb 28 2022 406 put for 2.20 (If it fills that’s still 13% annualized.)

I’ll reply when/if I get a fill. I think if SPY retests its overnight lows it should fill. Leaving now to go babysit grandkids. Lol.

SPY Put Ladder

Near the close, filling out more of my SPY put ladder (SPY closed at 440.46):

STO SPY March 31 2022 440 Put @ 14.50

Also, in a separate account not part of the ladder:

STO SPY March 11 2022 440 Put @ 11.15

Planning to sell every Friday at the close until the ladder is full, as long as SPY keeps trending above its 50-Wk moving average.

Have a great weekend everybody!

#shortputs #spyladder

SPY Put Ladder

Decided to go 7 weeks out to start the ladder. Also planning to be aggressive with this ladder to try to keep up with the growth of SPY.

Sold SPY March 25th 2022 450 Put @ 13.00

SPY Covered Calls

Managed to get out of my long stock for breakeven. Basis was 446.33 and closed stock plus covered calls for 446.35. Looking to build a put ladder over the next few weeks as long as SPY keeps trending above its 50-Wk MA.

SPY Put Ladder

#shortputs #coveredcalls – Swapping some long stock out to start a put ladder in SPY.

Sold SPY Feb 04 2022 450 Covered Calls at $4.22. (bought stock for 450.50)

Hoping for a down day this week to sell a March 4th 440 put (at the 200-Day MA) for around 9 bucks. Planning to sell puts every Friday, 5 weeks out, at the 200-Day MA, as long as I can get at least 1% of the strike price. Just being greedy on this first one hoping for the $9. Wish me luck!


Trying to gradually fill a gold position:
STO GLD Feb 19th 165 Put @ 1.01


In case I’m wrong and the market keeps going up like a SpaceX rocket:
Closed SPY Jan 15th Butterfly. Net loss 4.10.
Still holding SPX BECS hedged with SPY long call.


Not trusting this rally, so:
BTC SNOW Jan 15th 290 Put for 4.60, STO for 7.00.

SPX BECS Hedge Using SPY Long Call

Took advantage of the pullback to buy some cheap insurance for my SPX BECS.
BTO 1 Contract SPY Jan 29th 385 Call for 1.10. Paying $110 now reduced my planned exit max risk from $1000 to $575, almost cutting it in half. Max profit now is $1715.

Come to think of it, since the new SPY call expires after my SPY butterfly, it is sort of an extra hedge for that position too.

New SPX P&L Diagram:

Jan 29th SPX BECS With SPY Call Hedge

SPY Butterfly Risk Reduction

Took advantage of the early rally to rollup the lowest put and eliminate downside risk. Then, took advantage of the pullback to squeeze the upside of the butterfly to reduce upside risk.

Original Butterfly Strikes:
334 / 357 / 380
New Butterfly Strikes:
344 / 357 / 377

Still targeting between $500 and $1000 profit, new max risk is $534 (only to the upside).

Fans of Butterfly trading and of Gavin Mcmaster may recognize this as a “Reverse Harvey” adjustment. Here’s a reference for anyone interested:

Butterfly Course Part 12 – Adjustments!

New P&L Diagram:

Jan 2021 SPY Put Butterfly Squeezed


The BECS Thesis:
SPX is rarely above 15% above its 50-Week MA, and when it is, it doesn’t stay there for very long. Currently, it is 15.9% above that MA and has been as high as 16.7% above it at the recent ATH. The rubber band is pretty stretched, and should pull back at some point, even if it’s done by trading sideways while the MA catches up.

With SPX’s 50-Week MA having risen 43 points over the last month, I am projecting that that MA will be approximately 3261 in 4 weeks (it is 3218 now). Multiplying 3261 by 1.15 equals 3750. Padding that by a little for mom and the kids gets me up to 3800 for the short strike of a BECS.

The Trade:
SPX Jan 29th (29 days)
STO 3800 / 3850 BECS for 18.25 (1 contract)
Capital Allocated: $5000
Potential Max Profit: $1825
ROC: 36.5%
Planned max loss: $1000
ROR: 182.5%

The Plan:
Upside breakeven is at about 3820 on the SPX, and my loss at that point (based on T-0) will be about $1000. If SPX reaches that point, I will roll up and double, based on my bearish thesis above.


Hi folks. I’m new to the bistro, but I’ve been tinkering with options trading for awhile, and I finally decided to start posting some of my trades in case anyone is interested.

This one is a bearish put butterfly that makes money if SPY pulls back. It also would have been profitable if SPY had gone nowhere after I put it on, but the market has been slowly climbing and now it’s nearing its upper expiration breakeven strike. If I were putting this on today I would use higher strikes, so that the trade would be reasonably profitable even if SPY expired right where it is now.

Currently, the position is showing a loss of $89. If SPY continues on up to the point where my loss reaches $250, I will add another butterfly at higher strikes to widen the tent. I will also try to avoid dealing with expiration week gamma by planning to close the week before if I can get any kind of decent profit.

Edit: Thanks to Hawk’s questions, I changed the plan for adjusting if SPY continues up. See the comments below.

Here’s the position:

#Bearish Butterfly

SPY Jan 15th (Monthly)
334 / 357 / 380 Put Butterfly BTO for 7.20
Max Profit $1580, Target Profit $500
Max Loss $720, “Take Action” Loss $250

I’ll update as I manage or close the position. If any of you are experienced butterfly traders I would appreciate any advice! Thanks!

Jan 2021 Put Butterfly