SPY Toe Dipping

I missed my trading approach today a lot actually.

As mentioned last night, I realized that while my approached has worked in the past several times when I've followed my own structures, it is not fit for a growing small bank account. I'm not saying that one couldn't get lucky and exponentially grow, but it is risky and not the most sustainable approach. As a result, I'm diverting to trading the indexes almost in the same approach.

The indexes trade is similar to my intraday option trading, the difference is that I am 100% forced to close out my trades when they're 0TDE, which closes the margin for error and that thirst to keep contracts open overnight after a good run.

Today I went in almost unknowingly just to see that it was like, but my game-plan is to strategize this weekend to be suited up on Monday.

What happened in the toe dipping? I think I went with the same mentality as my intra day trading, almost. I saw the price going down pre-market and by the time the market opened, it dipped some more. As I don't trade the first 30 mins, I wanted to keep it pushing down so I entered a contract for $738 strike price when the price for SPY was $739 – my mistake here is that I wanted it to keep gapping down even though the lowest has already been reached earlier.

Let's have a look:

With that price box, I've highlighted where I entered my contract and where I exited. There was a $1.52 price increase in SPY in one hour, this pushed me for a loss.

Here's my take, I don't think SPY is volatile as far as extreme price change goes.However, I do think SPY switches back and forth by dollars in a given 1-5min period. Aside from that, we can tell that the price pretty much remained horizontal.

The weekend prep:

• This weekend will consist of me analyzing SPY, QQQ, and other indexes
  • Identify any possible trends/patterns
• Understanding the relationship between the indexes vs the sectors and stocks.
  • This may offer certain clues ahead of the day

Temporarily walking from something you developed (a system) is hard. Except, the goal is to become better, and in the end, I do enjoy that I get to trade at the macros level. Exciting weekend ahead for learning!