SPX Trader's Blog Archives - SPX Option Trader

Week in Review 12/16/2024-12/20/2024

This past week at SPX Option Trader showed mixed results. The Late Day Trader delivered a strong +268% ROI, while other strategies experienced small drawdowns: -47% ROI in our SPX Daily Outlook, -55% ROI in our SPY Daily Outlook, -38% ROI in our SPX Aggressive trader, -37% ROI in our SPY Aggressive trader and -68% ROM in our SPX Spread Trader.

We only had two trading days this week for the Daily Outlook, Aggressive Trader, and Late Day Trader strategies due to the combination of the Fed meeting and the high cost of options. A reminder: we don’t trade every day just for the sake of trading. When options are too expensive, it’s best to hold off. Part of being a successful trader is knowing when to trade and when not to. High option prices often require larger market moves to be profitable, which is why we choose not to day trade when options are priced too high.

Despite the cost of options, we continue to provide our SPX Daily Outlook each day, allowing traders to trade the market if they choose. Our forecasts are a reliable tool, no matter the market conditions. However, even with accurate forecasts, we recommend waiting when options are too expensive to avoid unnecessary risk. Extreme moves, like the ones we saw this past week, are not unusual, especially after the recent historic highs. We’ve seen this happen before and eventually the volatility will settle out and the markets will return to more normal trading. We remain consistent in our approach and only trade when market conditions are favorable. We’re looking forward to another successful week ahead, day trading SPX and SPY options on expiration day.

As a reminder: there will be no trading activity or market forecasts on Tuesday or Wednesday next week due to the holiday schedule. We wish you and your families a very Merry Christmas!

12/16/2024

Daily Outlook

We forecast a down day in the market and entered our positions 9:35 a.m. We Initially we were focused on levels just above the high of the day as our possible stop level. As the market started to drop, we adjusted our trailing stop to about 45%. We wanted to give it room to move, but protect ourselves if the market reversed direction. The market started to bounce and as it did, we exited our positions just before 9:55 a.m. for -25% in SPX and -32% in SPY. Just didn’t go our way, so we shake it off and look forward to what tomorrow will bring.

Aggressive Trader

We forecast a down day in the market and entered our positions 9:35 a.m. We adjusted our stop level as the market moved at exited our positions just at 10 a.m. for -40% in SPX and -43% in SPY. Just didn’t go our way, so we shake it off and look forward to what tomorrow will bring.

Spread Trader

We held our SPX Spread Trader position to the close for -39% ROM. With 3 minutes to go in the day, we were looking good for a full profit, but quick bounce and we settled out for a small hit today. Just didn’t go our way, so we shake it off and look forward to what tomorrow will bring.

Late Day Trader

Just before 2:30 p.m. we entered a put option trade. The market bounced around and finally started to drop near 3:30 p.m. We were watching our position very closely and after hitting over +230% we were using about a 40% trailing stop. The market started to bounce and so we quickly exited our position just before 3:50 p.m. for +193%. Another profitable day and we look forward to what tomorrow will bring!

12/17/2024

Daily Outlook

We forecast a down day in the market and entered our positions 9:35 a.m. We were focused on the daily target level in the SPY for our potential stop level. The market briefly went our way, but then started to rally. As it hit the daily target level in the SPY we exited our positions just before 9:45 a.m. for -22% in SPX and -23% in SPY. Just didn’t go our way, so we shake it off and look forward to what tomorrow will bring.

Aggressive Trader

We forecast a down day in the market and entered our positions 9:35 a.m. We adjusted our stop level as the market moved at exited our positions at 10:40 a.m. for +3% in SPX and +6% in SPY. A small, but profitable day and we look forward to what tomorrow will bring.

Spread Trader

We exited our SPX Spread Trade early for a return +2% ROM. Another small but profitable day and we look forward to what tomorrow will bring!

Late Day Trader

Just before 2:10 p.m. we entered a put option trade. The market went in our direction rather quickly. We were watching our position very closely and after hitting over +110% we were using about a 40% trailing stop. The market started to bounce and so we exited our position just after 2:40 p.m. for +74%. Another profitable day and we look forward to what tomorrow will bring!