August 2025

-$4669

6 trades

3W ($724)

3L (-$5393)

MA crushed me, I discuss it more at some point below.

DE was a wing hedge that turned ugly fast.

This turned out to be another huge research post.

After I had just done Julys massive restructuring posts, in the first week, I had already seen another black swan sell crush me and a wing hedge that is supposed to offset loss, turn into a 5x loss of the original trade.

I had to step away

I had to rethink everything

I had to look deeper

I had to ask myself the question, what am I really doing here?

So I went through some soul searching this month. It was tough but journaling and typing it out always helps me get through it. And I believe I got 90% of the way there. I got to the point I was satisfied with understanding why I was dissatisfied with what was going on. And to the point I would know how to go on from there.

Some of this post I had started in late July, getting a head start on stat research, but after the ugly week, it quickly turned into rethinking everything I was doing.

I stress tested everything I could think of to boil it all down to something that made sense again. And I think I did a good job.

Spent nearly everyday just researching and journaling. No trading until it was figured out.

And I sit here 8/28 with a new trading/risk plan again.

Because something had to change.

1 Black swan OTM spread loss means I need dozens of wins to make it back.

And now that I had seen 2 in back to back weeks, no way can I keep risk that large.

There is a TLDR near the bottom that sums up this months worth of typing.

FED Days

Its just not worth it. Dont trade on FED rate days. Let the dust settle.

With my new closer strike selection process, its going to trigger or at least close to. Just wait for next day. No new trades same day.

Remember MS

A STUDY ON DAY 2 PROFITABILITY

Goal is always to get bigger in our best performers. This will help judge when and where.

If by Day 2 profitable, what are chances we win

what are chances we break day of entry hi/lo against?

what are chances we lose hourly trends

For starters some Day2 Stats.

60W 13L 82% WR on trades that option is profitable on day2.

Only 5 winners of 66 possible wins total did NOT have a profitable day2. 8%

This also led to only 5 winners on Day 3 not in favor 8%

MAE stats are very close to Winners, obv a bit worse as we have more losers to include.

Red flags average only 1 more than winners in total and technical.

Volatility metrics the same.

Technical Red flag percentages are just a bit worse. Again from losers included.

So again, we have a 90% scenario here, Day2 in favor is hugely important.

For the questions above

ON ALL TRADES THAT HAVE A PROFITABLE DAY 2

60 W 13 L

82% W if Day2 in Favor

what are chances we break day of entry hi/lo against?

W 26%

L 85%

what are chances we break Entry Price?

W 77%

L 100%

what are chances we lose hourly trends

I will gague this by technical red flags

W 9.6

L 7.2

In terms of which MAs and timeframe, the winners just did better. No major standouts. Nothing Actionable.

So lets do straight winners and losers now.

what are chances we break day of entry hi/lo against?

W 28%

L 90%

what are chances we break Entry Price?

W 72%

L 97%

Pretty much the same

Overall this study is telling me, when Day 2 action is favorable and seems very likely to stay that way, that is when I can get big.

I have a habit of getting big on Day 1 and then seeing trades revert on me while i already have size on. There can be a good method here of waiting to put that size on, on day 2 good PA.

Since 93% of winners have profitable Day 2 action,

A STUDY ON PULLBACKS IN WINNERS

A CLOSER LOOK AT STRIKE SELECTION

The following is a flow of thoughts with some stat review mixed in.

Originally this started as a way to check where can I add to my winners.

It quickly turned into discovering I need to be selling much closer strikes.

35-45 Delta strikes.

So It started as planning to look at pullbacks on winners and seeing if I can add on lows thats turned around and became a new weekly hi/lo and that could be my stepped up strike.

But that doesnt quite make sense as if I step it up and it reverts on me, I am eliminating a win and turning it into a loss.

IF I WAS TRADING LIKE I USUALLY DO WITH 15-25 delta

It makes more sense to add with strikes further out, hedge less.

But again as ive now seen 2 weeks in a row. Doing that will absolultey crush me if just 1 trade goes wrong. Months of profits gone if 1 max loss reached.

.....But.....

As the stats tell me.

And always have.

Best winners work immidiately and dont come back.

And if thats the case I can sell 50 deltas.

And if I do that I must change my whole management process.

This reminds me of SMBs SAD trade.

3 piece trade, speculative, anticipate, definitive. Start small, add big. Start OTM, add ITM.

The D is the interesting peice. You sell a ITM spread. Your RR is greater than 1. but holding to EXP is bad idea.

So this makes me think. First look at these percentages.

ORIGINALLY......

On winners

How many winners broke a prev hod/lod

W Bear 19%

W Bull 41%

And same questions as Day2 study but now for all winners.

what are chances we break day of entry hi/lo against?

W Bear 19%

W Bull 38%

what are chances we break Entry Price?

W Bear 75%

W Bull 68%

what are chances we break Weekly Hi/Lo?

W Bear 14%

W Bull 16%

More numbers in the 80%+ range. My winners rarely break the current weeks hi/lo.

Just cause curious

Losers

Break day of entry hi/lo 90%

Break Entry Price 97%

Break current week hi/lo 74%

My winners rarely go much against me, but they do go against me some.

Some red flags to re iterate.

-1%

-.5 ATR

-.5 to stop

AND THEN......

----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

You know, what really is my goal here?

Is it to take trades that expire at 0?

Is it to make money?

To make good RR trades?

Do I really need to hold trades all the way to friday close?

Can I just take trades at 50 delta, watch theta kill it, and take 80% of the premium?

Do I really have to hold as long as possible?

Is there anything wrong with taking 80% of the max profit?

I spent the last 4 months trading spreads. It is where my development as a trader has led me. Is it still the right path?

Shares are fine, but bad becuase overnight risk and lack of leverage

Straight buying OTM options you must be perfectly timed. Huge leverage. But pullbacks obliterate you. Very inconsistent.

Selling options are great with high WR, but depending how you trade very low RR and black swan losses.

Spreads are great because I like to swing, I like to have time work in my favor rather than against me. I like having options to reflect my trade ideas. I like not having to worry about time working against me, and rather have it work in my favor.

I like spread trading. It makes sense to me. It is easier to guess where a stock wont be, rather than where it will be.

You have many variables working in your favor selling options, but how you sell them, strike selection, days to exp, all matter.

They matter in terms of risk and weighing risk.

I can take .15RR trades, but one maxL comes along, wipes out months.

I can take .30 RR trades but one max L comes along wipes out months.

TEST TRADES

What does a 50delta spread look like?

If my best wins go and never return, why not sell like it.

Large prem, Much lower Max L. Much higher RR.

If I took a META trade, right now at 770,

5 ex

1. If sold put at W low to reflect above stat review (prioritizes stats)

2. If sold put at current price to reflect winners go an never come back (prioritizes winners)

3. If sold put at middle ground to split the difference (middle ground)

4. If sold at 1ATR against just to see

5. If sold old method of far out range low (prioritizes WR)

What is RR? On 5 contracts spread.

1. 757.50sell 32 Delta.

Max L $925 MaxP $325 RR .35

2. 770sell 50 Delta

MaxL $675 MaxP $575 RR .85

3. 762.50sell 38 Delta

MaxL $825 MaxP $425 RR .52

4. 750sell 23 Delta

MaxL $1000 MaxP $250 RR .25

5. 745sell 18 Delta

MaxL $1060 MaxP $190 RR .18

So questions to ask. Which is most likely to win. Which has best chance of profitability. Which has most risk. Which has best chance to exp at 0. Does exp at 0 really matter?

Who has best RR, who has best bang for there buck, who has black swan event risk, who has least likely large loss chance.

Im tracking these 5 fake trades throughout the week.

After Monday.

Close 765.9, MAE 764.7

At its worst $$

1. -$75

2. -$150

3. -$100

4. $0

5. -$10

The ATM is the worst performing. Oddly enough, didnt seem to change at all, held flat whole time.

The 1ATR and Far OTM are best.

MFE $$

1. $25

2. $75

3. $50

4. $90

5. $65

At Close $$

1. -$100

2. -$175

3. $55

4. $115

5. -$30

What I am seeing, is the closer ATM delta I sell, the smaller the MAXL.

On Tues we had a large pop. Decided to do a random 10am check of P/L

1. $183 56% of MaxP

2. $248 43% of MaxP

3. $233 54% of MaxP

4. $203 81% of MaxP

5. $118 62% of MaxP

The ATM chart has the most rel str. Makes sense, has a higher delta, less fall off, more vega.

All other things equal here, the 1ATR is having the fastest drop off, fastest to Max P.

And another an hour later

1. $198 61% of MaxP

2. $298 52% of MaxP

3. $258 61% of MaxP

4. $173 69% of MaxP

5. $128 67% of MaxP

Now that ATM seeing a big drop as rest increased.

And another an hour later

1. $233 72% of MaxP

2. $388 67% of MaxP

3. $298 70% of MaxP

4. $188 75% of MaxP

5. $138 73% of MaxP

META moving well in bullish direction.

Starting to see expected things. The ATM puts still have lots of prem left so $$$ going up faster.

Theres not much left in the tank on the OTM ones so rising much slower.

THIS I THINK IS KEY

Your RR changes all throughout the trade

The ATM puts/Near the money puts still have a good chunk of reward left in them.

The OTM RR is now changing drastically. For that last 25% the est risk is still the est risk.

It is not changing.

Another key thing to think here.

How much cents have we gained on all trades at this point.

1. $4.67 5.55 to .88

2. $8.31 10.30 to 2.04

3. $5.95 7.20 to 1.25

4. $3.17 3.75 to .58

5. $2.38 2.83 to .45

My Major losers have MAE% that in the hundreds. So a move from .50 to 2$ is not out of the question.

Still a 1:4 RR on the sell side, but now prem on the buy side is not near as strong so it ends up being closer to 1:10

The ATM sells have a higher theta, so it becomes much harder for them to catch back up on reversals against me.

META is at 791 right now, what happens to my 770sell if it drops back to 770?

Intrisic is 0, extrinsic is the problem. 10$ of extrinsic value? No way.

My 745sell however, has 0 intrinsic, but currently the 765(trading 25pts away) is at 1.5. Which is a lot closer to breakeven than the 770 would be, which is 8 points away.

Bottom line, prem was so high to start this trade, that even on a pb, its chances of the sell going past breakeven are very low.

Chances of my deep OTM going past breakeven are much higher.

My avg Loss sold option is 1$, my avg out is $1.50

My avg MAE% on sell is 200% meaning at the trades worst, its 3x as much as open price.

ex sold at 1, topped out against me at 3.

My avg out % is double the sold option.

Half my lossses the sold option itself was profitable.

The problem is the hedge in this case,

avg hedge exit is only 43% what the entry was.

And another an hour later very small drift a dollar lower

1. $233 68% of MaxP

2. $348 60% of MaxP

3. $283 66% of MaxP

4. $183 73% of MaxP

5. $138 73% of MaxP

Nothing notable here.

Trading closer ATM strikes means I have more prem to capture.

An ATM trade at 80% is the same as an OTM trade at 100% with LESS RISK.

LESS RISK because

-I cut faster

-Smaller Max L.

-Adds on Day 2 are not .50c max, they are in dollars still.

High initial prem acts as a moat

On a deeper OTM big reversal against, my rules tell me hold out and hedge furhter with a new added wing.

On a ATM/NTM big reversal against, my rules would have me out the trade, and since prem so large to start, depending what day this reversal happens, chances are I can still have a winner.

OTM makes me force a win.

ATM accepts defeat.

And in the long run

OTM is defeating.

ATM cut the loss move on.

Grok Notes:

ATM MaxP was $575; 80% = ~$460. OTM (#5) MaxP $190; 100% = $190. So yes, ATM at 80% dwarfs OTM full capture, and you exit earlier (e.g., Day 2 at 67% in sim = ~$385 already > OTM's full $190).

OTM can linger in "maybe it'll decay" limbo, leading to forced holds.

Next Day

Good PB still holding yest low of range. But trading at it looking like lower.

Hour After open.

1. $243 75% of MaxP

2. $378 66% of MaxP

3. $318 75% of MaxP

4. $203 81% of MaxP

5. $148 78% of MaxP

Still trending about the same towards MaxP.

The nice thing about ATM/NTM is there is still a good RR here.

If This did in fact turn aggressively on me and hit 770. What would my trades look like at that point.

My OTM trades would probably turn negative, the ATM can still be profitable.

Becuase if this trade does revert on me, i can cut and keep a win. and that win more than likely is going to be as big if not bigger than the OTM MaxP. Which I would still be holding and stressing about holding to exp.

Cutting trades off feels good. To me as a trader. Holding and waiting and watching it go more and more against me does not feel good. it is stressful. My plan of creating a wing to add adds more stress, not less.

And if the ATM doesnt exp at 0, so what, theres nothing wrong with taking 50% maxP. 50% max P is 100% of OTM

It seems obvious at this point that 35 delta+ is the way to go here.

At Close

1. $243 75% of MaxP

2. $288 50% of MaxP

3. $263 62% of MaxP

4. $193 77% of MaxP

5. $158 83% of MaxP

It did slowly trend and give back 5pts.

OTM didnt care, but closer to the money saw a decent pullback.

Thurs we had a gap down and flush, what happened at worst points here.

$143.00 44%

$48.00 8%

$148.00 35%

$158.00 63%

$133.00 70%

An on recovery right after.

$273.00 84%

$338.00 59%

$338.00 79%

$208.00 83%

$168.00 88%

The main note here, is 80% capture, this trade on Wed lost 9.20ma which is a big nono overall and trended lower all day. Prior to that point, we hit a max on the following

1. 90% Max Profit

2. 75%

3. 80%

4. 95%

5. 87%

The options themselves all hovered around 90% prem loss.

Bot Sold

1. -91.02% -90.99%

2. -88.80% -87.63%

3. -91.34% -89.58%

4. -89.54% -91.20%

5. -89.80% -89.40%

So what do I see here?

Even with deeper PB, ATM recovered very well very fast. I do not get out at open. There is still huge buffer from theta crush and high prem entry that a big pb that happened, I can still wait it out for theta to come back in favor before exiting for a small winner. If I was to bail out fast, Small win still but the better move is always wait for vol at open to cool off and watch theta crush prem again for better move in favor before exit.

If bounce never came, still 12pts to Strike where extrinsic value initially sold would be huge buffer.

At Close Thurs

1. $243 75% of MaxP

2. $288 50% of MaxP

3. $263 62% of MaxP

4. $193 77% of MaxP

5. $158 83% of MaxP

And friday straight to 0 for all.

FIND A TRADE I WOULD HAVE TAKEN THAT IS A LOSER

GO BACK HOUR BY HOUR, FILL IN THE GAPS AND SEE PROFITABILITY, LOSS, WHICH GETS WORSE FASTER OR SLOWER

Testing Next: As planned, sim a loser (e.g., MA 8/6) with ATM vs. OTM hour-by-hour. Expect ATM to worsen slower (moat effect), cap lower, and allow "still a winner" if PB late. Calc dynamic RR at each snapshot (remaining reward / est risk).

Something I would like to see is what happens to these when it goes in favor, then against past entry price. Do some still have profit? are they all negative? Does getting out at breakeven mean get out at entry price, or based on p/l?

Is it easier for an ATM to break past even or OTM? Under what circumstances.

OTM is always at breakeven/negative risk even when points in favor.

Theta does not help OTM as much as it does ATM.

ATM theta so big that with stagnant PA, it will kill prem much faster and be much harder to recover to get to point of big loss, which per stop rules, I would be out much faster before it got there.

Grok:

The key theme is the "buffer" from high initial premium and aggressive theta decay in ATM positions, which allows for patient management without forcing early exits. This contrasts sharply with OTM's fragility, where low premium means constant breakeven risk and less theta assistance.

Its 8/15, I see TSLA, NVDA and MSFT are good examples to look at.

And just a reminder

1. If sold put at W low to reflect above stat review (prioritizes stats)

2. If sold put at current price to reflect winners go an never come back (prioritizes winners)

3. If sold put at middle ground to split the difference (middle ground)

4. If sold at 1ATR against just to see

5. If sold old method of far out range low (prioritizes WR)

NVDA

1. 180sell

Max L $950 MaxP $294 RR .32

2. 182.50sell

MaxL $800 MaxP $444 RR .56

3. No middle ground

4. 177.50sell

MaxL $1070 MaxP $174 RR .17

5. 175 sell

MaxL $1140 MaxP $104 RR .10

Trade at its worst

1. $-187 -62% of MaxP

2. $-277 -61% of MaxP

4. $-152 -84% of MaxP

5. $-117 -106% of MaxP

First time breaking 180 Tues 9am

1. -$177 -59% of MaxP

2. -$262 -58% of MaxP

4. -$127 -71% of MaxP

5. -$77 -70% of MaxP

2nd time breaking low under 180 wed 1015

1. -$227 -76% of MaxP

2. -$332 -73% of MaxP

4. -$142 -79% of MaxP

5. -$77 -70% of MaxP

Retset of that low wed 1150

1. -$237 -79% of MaxP

2. -$337 -75% of MaxP

4. -$132 -73% of MaxP

5. -$172 -65% of MaxP

Open test of that low thurs 830

1. -$212 -71% of MaxP

2. -$362 -80% of MaxP

4. -$92 -51% of MaxP

5. -$27 -25% of MaxP

Friday MAE of low 178 855

1. -$422 -140% of MaxP

2. -$627 -139% of MaxP

4. -$147 -82% of MaxP

5. -$12 -11% of MaxP

At Close Fri

1. $294 100% of MaxP

2. $-592 50% of MaxP

4. $174 100% of MaxP

5. $104 100% of MaxP

So this was flat out a llosing trade all the way through for ATM, One strike under would have been a loss as well I would have taken at some point in this. I really dont think I would have teaken this in the first place, but for sake of trade examples, that is besides the point.

I really want to know how the p/l fluctuates differntly on this trade when we flash dip and how does ATM - NTM - OTM react.

Grok ghave me this table

Moment/Event	Trade 1 (NTM) P/L $ (% of MaxP)	Trade 2 (ATM) P/L $ (% of MaxP)	Trade 4 (OTM) P/L $ (% of MaxP)	Trade 5 (Far OTM) P/L $ (% of MaxP)
Trade at its worst (overall MAE)	-$187 (-62%)	-$277 (-61%)	-$152 (-84%)	-$117 (-106%)
First break of 180 (Tues 9am)	-$177 (-59%)	-$262 (-58%)	-$127 (-71%)	-$77 (-70%)
2nd break under 180 (Wed 1015)	-$227 (-76%)	-$332 (-73%)	-$142 (-79%)	-$77 (-70%)
Retest of that low (Wed 1150)	-$237 (-79%)	-$337 (-75%)	-$132 (-73%)	-$172 (-65%)
Open test of low (Thurs 830)	-$212 (-71%)	-$362 (-80%)	-$92 (-51%)	-$27 (-25%)
Friday MAE at low 178 (855)	-$422 (-140%)	-$627 (-139%)	-$147 (-82%)	-$12 (-11%)
At Close Friday	$294 (100%)	-$592 (50%)	$174 (100%)	$104 (100%)

NVDA is tough to judge. This would be a much differnet clearer picture if I could trade 179/178/181 strikes. That 2.5 is wide for a 4.3 ATR stock.

As for the 180 sell, it would be REALLY hard to not bail on the flush friday morning and especially hold out for a above 180 close.

177.50 the same. But that would have probably stuck.

So this trade doesnt provide the best picture to compare all these ATM/OTM strikes. Its a trade off here. Yeah 177.50 175 would have more than likely ended up winners, and the 180/182.50 would be losers that I should be bailing on.

But how big woudl those losers be.

In most cases it seems safe to assume they would be a loss of about 80% maxP.

Which is noteworthy because I am aiming for taking trades off at 80% max P.

So I think we can chalk this up as

-I can assume a loser on this ATM/NTM trade would be a 1:1RR.

Does that mean its always going to be like that no, but its a start.

I think this is reminder I need to be thinking long term.

Yea OTM is a win, but theres going to be a trade or two that will wipe out several of these smaller ~$150 wins.

A $300 loss can hurt, but it can be made up with the next trade.

A $3000 OTM loss is going to take dozens of OTM trades to make back up.

Kinda goes back to trying to force a win here.

Insight: ATM demands faster takes (e.g., at 80% mid-week like Wed MFE 36% ~$162 > OTM full $180) to avoid late disasters; riding exposes black swan risk, contradicting "winners go and never return" if PBs hit hard. Aligns with your 33% loss stat—sold leg might've decayed, but hedge dragged it (ATM's higher delta amplifies this)

MSFT

Slightly changed up here

1. ATM, Prioritize Wins, go and never come back

2. Middle ground

3. Prioritze Stat, at Weekly lo

4. 1 ATR

5. Prioritize WR

1. 527.50 sell

Max L $519 MaxP $725 RR .72

2. 525 sell

MaxL $379 MaxP $865 RR .45

3. 522.50 sell

MaxL $284 MaxP $960 RR .30

4. 520 sell

MaxL $174 MaxP $1070 RR .17

5. 517.5 sell

MaxL $139 MaxP $1105 RR .13

In on a Tuesday

Trade 1st big flush wed 1010

-$12.00	-2.29%	% of Max P
-$27.00	-7.01%	% of Max P
$23.00	7.93%	% of Max P
-$12.00	-6.67%	% of Max P
$8.00	5.52%	% of Max P

Recvoer from wed flush 1110

$53.00	10.10%	% of Max P
$78.00	20.26%	% of Max P
$88.00	30.34%	% of Max P
$23.00	12.78%	% of Max P
$63.00	43.45%	% of Max P

Trade at its worst Wed before close 245 MAE

-$372.00	-70.86%	% of Max P
-$477.00	-123.90%	% of Max P
-$402.00	-138.62%	% of Max P
-$372.00	-206.67%	% of Max P
-$252.00	-173.79%	% of Max P

Thurs morning attempt lower 840 MAE

-$372.00	-70.86%	% of Max P
-$377.00	-97.92%	% of Max P
-$372.00	-128.28%	% of Max P
-$292.00	-162.22%	% of Max P
-$222.00	-153.10%	% of Max P

Thurs HOD MFE 955

-$102.00	-19.43%	% of Max P
-$42.00	-10.91%	% of Max P
$18.00	6.21%	% of Max P
$23.00	12.78%	% of Max P
$53.00	36.55%	% of Max P

Thurs New LOD push 155

-$437.00	-83.24%	% of Max P
-$552.00	-143.38%	% of Max P
-$397.00	-136.90%	% of Max P
-$307.00	-170.56%	% of Max P
-$117.00	-80.69%	% of Max P

^^^HOW DOES THIS COMPARE TO EARLY MORNING^^^

This one is odd to me. Intial drop at open, but then later in day still an hour before close, losses show mich worse despite price being the same.

It does make more sense becuase now my ATM trades are now deep ITM and ex value climbs faster.

This tells me I need to bail faster still. Dont stick around and wait and hope.

Even if it does come back in favor for you, its too far ITM that delta becomes too high and pullbacks dont give you back that much.

Thurs close

-$172.00	-32.76%	% of Max P
-$432.00	-112.21%	% of Max P
-$162.00	-55.86%	% of Max P
-$87.00	-48.33%	% of Max P
$13.00	8.97%	% of Max P

Fri HOD 915

-$437.00	-83.24%	% of Max P
-$127.00	-32.99%	% of Max P
$53.00	18.28%	% of Max P
$103.00	57.22%	% of Max P
$103.00	71.03%	% of Max P

Fri MFE

-$172.00	-32.76%	% of Max P
$223.00	57.92%	% of Max P
$238.00	82.07%	% of Max P
$174.00	96.67%	% of Max P
$139.00	95.86%	% of Max P

Fri Close

-$237.00	-45.14%	% of Max P
-$982.00	-255.06%	% of Max P
-$967.00	-333.45%	% of Max P
$174.00	96.67%	% of Max P
$139.00	95.86%	% of Max P

Notes

Even on friday, the ATM, NTM trade can still turn profitable even with a good pop in favor.

Speed favors ATM recovery (fast crush on rebound), but OTM lingers longer in negativity (slow decay)

ATM trades have deeper faster recoveries than OTM do.

TSLA would be considered a chase trade, post breakout, late.

1. 320sell

Max L $925 MaxP $325 RR .35

2. 770sell

MaxL $675 MaxP $575 RR .85

3. 762.50sell

MaxL $825 MaxP $425 RR .52

4. 750sell

MaxL $1000 MaxP $250 RR .25

5. 745sell

MaxL $1060 MaxP $190 RR .18

At Close Mon

1. $243 75% of MaxP

2. $288 50% of MaxP

3. $263 62% of MaxP

4. $193 77% of MaxP

5. $158 83% of MaxP

At Close Tues

1. $243 75% of MaxP

2. $288 50% of MaxP

3. $263 62% of MaxP

4. $193 77% of MaxP

5. $158 83% of MaxP

At Close Wed

1. $243 75% of MaxP

2. $288 50% of MaxP

3. $263 62% of MaxP

4. $193 77% of MaxP

5. $158 83% of MaxP

At Close Fri

1. $243 75% of MaxP

2. $288 50% of MaxP

3. $263 62% of MaxP

4. $193 77% of MaxP

5. $158 83% of MaxP

What does that mean a day later if it isnt working?

-It means get out faster

Assignemnt risk?

-This is why we get out faster.

How long am I holding a 50delta trade against me?

-Stats say not more than prev day hi/lo

-What does bid/ask look like at that point though?

-Can that get worse than Max Loss?

It looks like 50deltas mean I take on average larger losses and more frequent, and closer to MaxL.

But MaxL is way smaller

MaxL is also very close to estimated risk.

RR is also greatly improved.

Est risk formula needs adjusting.

Lets also make this clear. Setting a closer stop eliminates large losses. In the case of my huge losers ( a quick view of 8)

MS 7/29

-Traded during FED announcment, market theme changed on a dime, got crushed on 3% down gap.

-Sold 141 puts. When price at 143.3 and LOD at 142 and weekly low at 142. Could have sold 142

-Lesson learned here is dont trade during volatile weeks. Major Earnings week as well.

MA 8/6

-Valid setup, tight close MAs. No major news or industry earnings.

-Sold 560, price at 569.2, LOD at 564, Weekly low 562

-Trade looked perfect. Gap up, sold off 2.9 ATR no stop, NO STOP for 2 hours.

-1st 1min/1$ pb came after 2 hours and 6pts under sold strike.

-Trade went from A+ wanting to add big size to what the hell in 2 hours. Extreme to extreme.

-Lesson learned here is this has got to be a black swan trade. Things like this just do not happen regularly.

-If anything was to be done, its change my stop rules and just get out earlier.

DE 8/7

-Hedge against original Long trade that was failing.

-Sold 515 at 506.8. HOD 514, W Hi 514

-Next day gap up and rip

-Emotional from MA and now this, just bailed on it early as it was ripping and original long now working. Didnt want to get caught in mega squeeze.

-Need to stay away from wide spread names like DE and LMT or NOC. Just gives me a headache and heart ache watching them whip all over and I have no clear picture of risk.

MCD 6/24

-Bottom bounce trade.

-Sold 285, price at 290. D lo 288.6, W lo 285.6

-Good setup, just failed. But another giant non stop PB that didnt relent for hours.

GS 7/22

-Bad setup here, shorted into Rising MAs, caught up in LTF again.

-Sold 715 at 702. D hi 706.5 W hi 712.8

-Next day mega rip as I shorted the bottom.

-Another non stop move against.

SCHW 6/11

-Big bull flag, tight MAs

-Sold 87 at 88.45, D 87.9, W 87.6

-Caught in a news piece. Iran Israel strike news. Caught in down gap.

-Created stop rules from this.

-Nothing can do about this one.

MDB 7/9

-A+ Curl up from tight MAs

-Sold 202.5 at 215. D lo210, W lo 205.7

-This was first big odd tech sell day. Next day after entry just huge sell.

-Had warning signs but never actualy hit sell strike.

-Exp 1 penny above sell strike. Would have more than likely ended up a larger loss.

CRM 7/9

-Ignored HTF MAs that are trending against and on top of price. Caught in LTF again.

-Sold 265, at 275. D 269.4, W lo268.2

-Long term trend is not bullish, which is direction I took.

-Combined with big odd tech sell day, was jus tmore ammo to downside.

Common themes in all trades

-Only 1 had good Day2 Action (MS that got crushed after FED)

-All have very directional aggressive moves more than 1ATR with very little if any pullback in between.

-Sell strikes are fine.

This is making me want to make a column in losers tab that is a quick view of problems with trade.

-Chase

-News

-Ignored HTF

Are the main 3. 33% of losses, are just losses. The others I can clearly attribute to some circumstance. Mostly my own fault.

Need to go to trades and mark what day hit stop, or what day I exited

Too much getting huge on day 1

If majority of trades hit the shit on day 2, why am i getting big in fornt of that taking large risk on trades that havent proven themselves.

Trading closer strikes means prem will still be there.

Did a quick calc on this on losers. Heres the numbers.

If I exited same day, is a 1. to reflect day 1. If i exited day 2, its a 2.

31 Losers.

1 - 5

2 - 15

3 - 5

4 - 6

So most my loses occur the next day. Thus also accounts for half my losses $$$.

Run for the exit, dont walk?

90% of all my trades exp at 0. But at what risk is that 10%

90% is a real troubling number here. This has to be explored.

Youre telling me im right 90% of the time, but this nervous about risk? Im scared of losers on this 90%?

EXPLORE THIS^^^ WHICH 10% and what do stats look like with that 10% loss

The trades that did exp at 0 would have save $13,000. The ones that didnt were -$7000

BUT the ones that didnt I also cut early. So those losses would drasitcally increase.

There are 10 losers that did not exp at 0. 4 would have been max L. Those 4 Max L would have added roughly another $5000 in losses. And thats not including the added losses from the 6 that closed in between buy/sell strike.

All in all, still not worth it.

You get out when theres trouble. Run for the exit, dont walk, dont squeeze it out. Because yes 90% of the time myabe holding out cna work, but its those times that dont that kill you.

Running through notes on trades, a lot of my losers are coming from straight line moves with no pb.

33% of my losses are with sold option lower than when first in. These are all smaller than $260. I should be grateful to get out of loser with that stat. How does this apply here with ATM/NTM?

I am learning that ATM is not great for holding and require fasater exits 9/20 1hrma. but NTM there is give and take with letting it pb some.

At what point does it make sense to take an ATM/NTM off at breakeven? Or capture small win? Or let it go negative again?

If I cant get 40 delta, do i settle? Do i base these trades on the charts or the delta?

45delta for high confidence

35delta for average

explore vega more

Do I Base My Strike on the Chart?

Yes, Primarily—But Blend with Data: Charts provide context for support/resistance (e.g., Day/Weekly hi/lo, as your winners rarely break them: 14-16%), ATR for breathing room (e.g., your META at 770 with -0.5 ATR at 760, suggesting 38 delta strike), and trends (e.g., avoid ignoring HTF MAs, per your loser themes). This aligns with your simulations: closer strikes (35-45 delta) near chart levels like entry price or weekly lows offer the "moat" without over-tightness. Industry pros often start here for directional bias, then adjust for IV/expectations. Risk-wise, chart-based strikes reduce assignment/black swan exposure by respecting natural levels, but cross-check with data to avoid emotional picks (e.g., chase trades in 33% losses).

Do I Base My Stop on the Chart?

Yes, as the Core Trigger—For Risk Control: Stops should tie to chart levels like -0.5/-1 ATR, -1%, or hi/lo breaks (your rules), as they reflect real price action and prevent noise exits (e.g., META's 4.5 hourly ATR means expecting multi-point moves). Your data shows losers with aggressive >1 ATR moves without PB, so chart stops (e.g., below Day low) enable "run, don't walk" exits before max loss. This fits SMB SAD: definitive legs use tight stops based on confirmation failure. External views emphasize technical stops for risk management in spreads, especially ATM/NTM where delta amplifies moves. Prioritize this over strike-based stops to avoid holding through reversals (e.g., your NVDA Friday flush).

Do I Base My Stop on the Strike?

No, Not Primarily—Use as a Secondary Guardrail: Strikes represent breakeven/max loss thresholds, but basing stops solely here risks forcing holds (e.g., your OTM "decay limbo," or ATM going deep ITM where extrinsic climbs fast, per MSFT sim). Your stats (e.g., 77% winners break entry price but recover) suggest strikes are better for selection than exits—stop at chart levels first to cut early (e.g., before strike test, as ATM allows small wins on PBs via theta buffer). Industry consensus: strikes guide entry RR, but stops should be dynamic (e.g., % loss or Greeks), not rigid to strike, to manage vega/IV risks in ATM. Risk-first: this prevents oversized losses (e.g., your $3000 OTM blows).

Do I Base My Strike on My Data?

Yes, as a Validator—But Not Exclusively: Your data (e.g., 82% Day 2 WR, low winner reversals) justifies 35-45 delta for RR optimization, and simulations quantify trade-offs (e.g., ATM 80% capture > OTM full). Use it to refine (e.g., 45 delta for high-confidence setups, 35 for average; incorporate vega for IV sensitivity—higher in ATM for recovery, but watch crush). However, data alone ignores real-time charts/market sentiment—blend for holistic picks (e.g., data suggests closer strikes, charts confirm levels like -0.5 ATR). Pros often use data (IV, probability) to filter chart setups, ensuring risk alignment. This supports your long-term thinking: smaller, recoverable losses over wipeouts.

Final Recommendation

Adopt a hybrid: Strikes on Charts + Data (e.g., 35-45 delta near support, validated by RR stats), Stops on Charts (e.g., -0.5 ATR/-1%, with strike as max pain alert). This "Risk first" framework enhances your summation—test via paper trading or tools like Optionistics for vega/strike sims. Remember, no strategy is perfect; focus on the 10% losers with filters (e.g., no FED weeks).

Day 2 adds are a concern. If it goes too far too fast in my favor, my adds can have a poor RR. If its already gone nearly 80% in favor, then theres not much left, but time will tell how that plays out.

As with any trade, if day 1 rips in favor then yes, prem is going to drop even faster than OTM from theta and RR decreases on Day 2 adds.

There is a balance here to find with more trades.

Next section to figure this out.

A STUDY ON PULLBACKS IN WINNERS CONT

I am trying to determine risk. My risk is based on a stop, my stop is based on my data. My data tells me majority of the time winners do X, X% of the time. When a trade does X, I need to think protect rather than hold.

My red flag system gave me a line in the sand to start thinking loss management.

With closer strikes and new trade management system, i need a new red flag system.

Here are some variables I think are going to help my figure this out

36 Bear

37 Bull

19 W Bear OverX

17 W Bear Flag

5 W Bull OverX

32 W Bull Flag

Metric	Bear Over Extended (%)	Bear Flag (%)	Bull Over Extended (%)	Bull Flag (%)
Day 1 close against 9ma 1hr	42% (8/19)	59% (10/17)	40% (2/5)	53% (17/32)
Day 1 close against 20ma 1hr	32% (6/19)	53% (9/17)	40% (2/5)	44% (14/32)
Day 1 close against 50ma 1hr	63% (12/19)	29% (5/17)	80% (4/5)	34% (11/32)
Day 2 close against 9ma 1hr	53% (10/19)	82% (14/17)	40% (2/5)	41% (13/32)
Day 2 close against 20ma 1hr	58% (11/19)	65% (11/17)	40% (2/5)	31% (10/32)
Day 2 close against 50ma 1hr	42% (8/19)	29% (5/17)	40% (2/5)	32% (9/32)
Day 1 close against 9ma 4hr	26% (5/19)	41% (7/17)	0% (0/5)	41% (13/32)
Day 1 close against 20ma 4hr	58% (11/19)	18% (3/17)	80% (4/5)	32% (10/32)
Day 2 close against 9ma 4hr	16% (3/19)	12% (2/17)	20% (1/5)	25% (8/32)
Day 2 close against 20ma 4hr	37% (7/19)	6% (1/17)	40% (2/5)	13% (4/32)

Nothing super noticable here.

Bull/Bear Flag trades have similar percentages.

Day2 4hr 9ma is probably the biggest note here.

Winners generally do not close against it.

4hr MAs in general the majority do not close against them. I would not say the vast majority.

If a trade does the following it is a red flag

-Day 2 Close under either 4hr9ma/20ma

-Day 2 1hr50ma

The rest really is a 5050

And thats ok becuase I have other clear MAE red flags to combine with this.

As for losers, 9/10 times they all closed against all these MAs.

NEW STAT REVIEW

Last week discovered my % formula were bugged. So looking at WvL again on technicals for bear and bull.

Metric W L

History 1.8 2

Score 6.3 7

Chart Score 26.8 27.9

SATA Sector 39% 43%

SATA Industry 43% 47%

SATA SubIndustry 45% 50%

SATA Score 7 6.6

Mansfield RS 2.1 2

Flag 64% 76%

OverX 38% 36%

Flat 63% 60%

ATR 9 9

Day of Entry > Avg Vol 35% 32%

DaysInRange 6 6.2

WeeksInRange 3.8 4.1

MonthsInRange 2.7 3.6

EverHad4hr9maTrendAgainst 38% 88%

EverHad4hr20maTrendAgainst 49% 64%

EverClosedAgainst4hr9ma 64% 92%

EverClosedAgainst4hr20ma 56% 88%

EverClosedAgainst4hr50ma 69% 80%

EverHad1hr9maTrendAgainst 85% 92%

EverHad1hr20maTrendAgainst 68% 68%

EverClosedAgainst1hr9ma 93% 96%

EverClosedAgainst1hr20ma 79% 96%

EverClosedAgainst1hr50ma 68% 92%

EverClosedAgainst9dma 50% 80%

EverBOAgainst 21% 88%

Score 116 105

Industry Strong 28% 44%

Sector Strong 7% 32%

QueryShows70%+ 26% 28%

QueryShows100% 6% 12%

SimilarDatesShowFavorableOutcome 15% 32%

BeatLastEarnings 71% 80%

PositivePostEFollowUp 64% 48%

Within10%52wkhi 50% 68%

WCandleG 63% 64%

50wmaInvolved 10% 0%

50dmaInvolved 15% 12%

Above50dma 67% 76%

RisingW9ma 69% 76%

RisingD9ma 67% 52%

Rising4hr9ma 65% 60%

Rising1hr9ma 54% 52%

W9maInFavor 38% 28%

D9maInFavor 46% 52%

4hr9maInFavor 69% 84%

1hr9maInFavor 86% 92%

Touching9WMA 8% 12%

Touching9DMA 46% 44%

Touching94hrMA 85% 96%

Touching91hrMA 92% 100%

Are9&201hrMATight 97% 96%

Are9&204hrMATight 90% 92%

Are9&20DMATight 46% 40%

Are9&20WMATight 7% 20%

Are9&20MMATight 1% 0%

AboveAllMAs 13% 8%

AllMAsCurlInFavor 14% 8%

AllMAsInOrder 4% 4%

AboveSeveralAnchV 82% 100%

AboveTopMostAnchV 51% 44%

TightAnchVCluster 44% 56%

AnchVSqueeze 36% 52%

RelStr 42% 48%

EdgeOfVA 53% 60%

FailedBreakOpp 46% 60%

TL Break 50% 56%

Volume 60% 40%

CDV 56% 60%

RelStrTrendInFavor 25% 56%

PrevS/R 76% 64%

FibS/R 76% 76%

RSPrevS/R 43% 32%

BBTouch 39% 32%

RSI>70<30 31% 28%

SqueezeNear0 17% 24%

1hrSqzInFavor 86% 88%

1hr0FlipInFavor 22% 24%

1hrMomoInFavor 68% 60%

1hrPrevS/R 26% 32%

4hrSqzInFavor 46% 64%

4hr0FlipInFavor 19% 28%

4hrMomoInFavor 79% 64%

4hrPrevS/R 29% 12%

DSqzInFavor 35% 28%

D0FlipInFavor 17% 12%

DMomoInFavor 49% 76%

DPrevS/R 15% 28%

WSqzInFavor 42% 52%

W0FlipInFavor 6% 12%

WMomoInFavor 36% 44%

WPrevS/R 13% 4%

MSqzInFavor 35% 32%

M0FlipInFavor 1% 0%

MMomoInFavor 33% 12%

MPrevS/R 1% 4%

EverHad4hr9maTrendAgainst 38% 88%

EverHad4hr20maTrendAgainst 49% 64%

EverClosedAgainst4hr9ma 64% 92%

EverClosedAgainst4hr20ma 56% 88%

EverClosedAgainst4hr50ma 69% 80%

EverClosedAgainst1hr20ma 79% 96%

EverClosedAgainst1hr50ma 68% 92%

EverClosedAgainst9dma 50% 80%

EverBOAgainst 21% 88%

The above is my red flag section. Almost everything else there is nothing notable. Things you think would be better for winners, things trending in favor, actually seeming to hurt. Odd.

But the red flag section is good to keep. Seeing these pop up in a trade is clear indication for wing adding.

Metric bear W bear L

History 1.62 1.77

Score 5.89 5.92

Chart Score 25.22 24.62

SATA Sector 39% 43%

SATA Industry 41% 44%

SATA SubIndustry 46% 46%

SATA Score 7 8.62

Mansfield RS 19 12.29

Flag 54% 62%

OverX 49% 54%

Flat 57% 46%

ATR 9.57 8.51

Day of Entry > Avg Vol 32% 38%

DaysInRange 5.05 4.23

WeeksInRange 2.68 2.92

MonthsInRange 2.08 2.38

EverHad4hr9maTrendAgainst 41% 77%

EverHad4hr20maTrendAgainst 38% 54%

EverClosedAgainst4hr9ma 65% 85%

EverClosedAgainst4hr20ma 57% 85%

EverClosedAgainst4hr50ma 76% 69%

EverHad1hr9maTrendAgainst 89% 92%

EverHad1hr20maTrendAgainst 73% 77%

EverClosedAgainst1hr9ma 95% 92%

EverClosedAgainst1hr20ma 81% 92%

EverClosedAgainst1hr50ma 70% 85%

EverClosedAgainst9dma 54% 77%

EverBOAgainst 22% 85%

Score 129.23 119.70

Industry Strong 30% 31%

Sector Strong 5% 38%

QueryShows70%+ 11% 15%

QueryShows100% 0% 0%

SimilarDatesShowFavorableOutcome 11% 23%

BeatLastEarnings 73% 69%

PositivePostEFollowUp 68% 69%

Within10%52wkhi 68% 85%

WCandleG 84% 54%

50wmaInvolved 3% 0%

50dmaInvolved 5% 8%

Above50dma 86% 92%

RisingW9ma 81% 92%

RisingD9ma 70% 46%

Rising4hr9ma 46% 31%

Rising1hr9ma 19% 15%

W9maInFavor 19% 8%

D9maInFavor 30% 54%

4hr9maInFavor 54% 69%

1hr9maInFavor 81% 85%

Touching9WMA 0% 8%

Touching9DMA 35% 23%

Touching94hrMA 78% 92%

Touching91hrMA 92% 100%

Are9&201hrMATight 95% 92%

Are9&204hrMATight 86% 85%

Are9&20DMATight 27% 23%

Are9&20WMATight 5% 8%

Are9&20MMATight 0% 0%

AboveAllMAs 3% 8%

AllMAsCurlInFavor 3% 0%

AllMAsInOrder 0% 0%

AboveSeveralAnchV 78% 100%

AboveTopMostAnchV 70% 69%

TightAnchVCluster 19% 31%

AnchVSqueeze 16% 15%

RelStr 73% 77%

EdgeOfVA 43% 31%

FailedBreakOpp 35% 38%

TL Break 43% 23%

Volume 62% 69%

CDV 41% 46%

RelStrTrendInFavor 14% 54%

PrevS/R 62% 46%

FibS/R 73% 69%

RSPrevS/R 59% 38%

BBTouch 51% 54%

RSI>70<30 54% 46%

SqueezeNear0 8% 31%

1hrSqzInFavor 92% 92%

1hr0FlipInFavor 24% 23%

1hrMomoInFavor 84% 77%

1hrPrevS/R 35% 38%

4hrSqzInFavor 43% 38%

4hr0FlipInFavor 24% 8%

4hrMomoInFavor 86% 54%

4hrPrevS/R 41% 23%

DSqzInFavor 22% 23%

D0FlipInFavor 8% 15%

DMomoInFavor 51% 77%

DPrevS/R 16% 31%

WSqzInFavor 35% 31%

W0FlipInFavor 3% 8%

WMomoInFavor 19% 15%

WPrevS/R 22% 8%

MSqzInFavor 14% 0%

M0FlipInFavor 3% 0%

MMomoInFavor 35% 8%

MPrevS/R 0% 0%

EverHad4hr9maTrendAgainst 41% 77%

EverHad4hr20maTrendAgainst 38% 54%

EverClosedAgainst4hr9ma 65% 85%

EverClosedAgainst4hr20ma 57% 85%

EverClosedAgainst4hr50ma 76% 69%

EverHad1hr9maTrendAgainst 89% 92%

EverHad1hr20maTrendAgainst 73% 77%

EverClosedAgainst1hr20ma 81% 92%

EverClosedAgainst1hr50ma 70% 85%

EverClosedAgainst9dma 54% 77%

EverBOAgainst 22% 85%

Same here.

Metric Bull W Bull L

History 2.09 2.18

Score 6.94 7.91

Chart Score 28.82 31.55

SATA Sector 40% 41%

SATA Industry 45% 50%

SATA SubIndustry 44% 52%

SATA Score 3.62 4.09

Mansfield RS -5.68 -5.82

Flag 76% 91%

OverX 24% 9%

Flat 71% 82%

ATR 8.33 9.24

Day of Entry > Avg Vol 35% 27%

DaysInRange 7.18 7.73

WeeksInRange 5.15 5.55

MonthsInRange 3.38 5.27

EverHad4hr9maTrendAgainst 32% 100%

EverHad4hr20maTrendAgainst 59% 73%

EverClosedAgainst4hr9ma 65% 100%

EverClosedAgainst4hr20ma 53% 91%

EverClosedAgainst4hr50ma 62% 91%

EverHad1hr9maTrendAgainst 82% 91%

EverHad1hr20maTrendAgainst 65% 55%

EverClosedAgainst1hr9ma 94% 100%

EverClosedAgainst1hr20ma 79% 100%

EverClosedAgainst1hr50ma 65% 100%

EverClosedAgainst9dma 47% 82%

EverBOAgainst 21% 91%

Score 103.47 91.18

Industry Strong 26% 55%

Sector Strong 9% 18%

QueryShows70%+ 44% 36%

QueryShows100% 12% 27%

SimilarDatesShowFavorableOutcome 21% 36%

BeatLastEarnings 71% 91%

PositivePostEFollowUp 62% 27%

Within10%52wkhi 32% 45%

WCandleG 41% 73%

50wmaInvolved 18% 0%

50dmaInvolved 26% 18%

Above50dma 47% 55%

RisingW9ma 59% 55%

RisingD9ma 65% 55%

Rising4hr9ma 88% 100%

Rising1hr9ma 91% 100%

W9maInFavor 59% 55%

D9maInFavor 65% 55%

4hr9maInFavor 88% 100%

1hr9maInFavor 91% 100%

Touching9WMA 18% 18%

Touching9DMA 59% 64%

Touching94hrMA 91% 100%

Touching91hrMA 91% 100%

Are9&201hrMATight 100% 100%

Are9&204hrMATight 97% 100%

Are9&20DMATight 68% 55%

Are9&20WMATight 9% 36%

Are9&20MMATight 3% 0%

AboveAllMAs 24% 9%

AllMAsCurlInFavor 26% 18%

AllMAsInOrder 9% 9%

AboveSeveralAnchV 85% 100%

AboveTopMostAnchV 32% 18%

TightAnchVCluster 74% 82%

AnchVSqueeze 59% 91%

RelStr 9% 9%

EdgeOfVA 65% 91%

FailedBreakOpp 59% 82%

TL Break 59% 91%

Volume 56% 9%

CDV 74% 73%

RelStrTrendInFavor 38% 55%

PrevS/R 91% 91%

FibS/R 82% 82%

RSPrevS/R 24% 27%

BBTouch 24% 9%

RSI>70<30 3% 9%

SqueezeNear0 26% 18%

1hrSqzInFavor 79% 82%

1hr0FlipInFavor 18% 27%

1hrMomoInFavor 50% 36%

1hrPrevS/R 15% 27%

4hrSqzInFavor 50% 91%

4hr0FlipInFavor 15% 45%

4hrMomoInFavor 71% 73%

4hrPrevS/R 18% 0%

DSqzInFavor 53% 45%

D0FlipInFavor 26% 9%

DMomoInFavor 47% 73%

DPrevS/R 15% 18%

WSqzInFavor 53% 91%

W0FlipInFavor 9% 18%

WMomoInFavor 56% 91%

WPrevS/R 3% 0%

MSqzInFavor 56% 73%

M0FlipInFavor 0% 0%

MMomoInFavor 32% 18%

MPrevS/R 3% 9%

EverHad4hr9maTrendAgainst 32% 100%

EverHad4hr20maTrendAgainst 59% 73%

EverClosedAgainst4hr9ma 65% 100%

EverClosedAgainst4hr20ma 53% 91%

EverClosedAgainst4hr50ma 62% 91%

EverHad1hr9maTrendAgainst 82% 91%

EverHad1hr20maTrendAgainst 65% 55%

EverClosedAgainst1hr9ma 94% 100%

EverClosedAgainst1hr20ma 79% 100%

EverClosedAgainst1hr50ma 65% 100%

EverClosedAgainst9dma 47% 82%

EverBOAgainst 21% 91%

Again same thing. Red flags are the only ones that seem to matter. Some more variance here, but smaller sample size. 30W, 8L

I asked Grok what best 10 variables were and gave me this

Metric	Original L	Original W	Bear W	Bear L	Bull W	Bull L
EverBOAgainst	88%	21%	22%	85%	21%	91%
EverHad4hr9maTrendAgainst	88%	38%	41%	77%	32%	100%
EverClosedAgainst4hr20ma	88%	56%	57%	85%	53%	91%
EverClosedAgainst9dma	80%	50%	54%	77%	47%	82%
RelStrTrendInFavor	56%	25%	14%	54%	38%	55%
EverClosedAgainst4hr9ma	92%	64%	65%	85%	65%	100%
DMomoInFavor	76%	49%	51%	77%	47%	73%
EverClosedAgainst1hr50ma	92%	68%	70%	85%	65%	100%
Volume	40%	60%	62%	69%	56%	9%
Sector Strong	32%	7%	5%	38%	9%	18%

Im going to delete a lot of these variables. I have refined this many times, I believe I can save myself some time when it comes to recording.

It is quite odd. Very often I see a lot of things that would expect a trade to work better for you, actually had much lower percentages on winners and higher on losers. Dmomo in favor was much more on losers that winners.

And in total, I scrapped all of them.

I know from my history what makes a setup good.

This review told me who cares.

The way I take trades is still the same. The way I select them is the same. The way I manage and what product I use and expecatations is different.

This Giant technical stat record was for edge digging.

And I did find it.

But now that ive done this hundreds of times, there is little gold nuggets left to find.

Im in my sweet zone.

I know that when I see that coil I know there are dozens of other things lined up as well alongside it.

As for everything else I tracked above, doesnt seem to make much difference in the end. So why keep tracking it its not proving to provide edge.

Red flags are what matters to me now. And that is what my technical sheet will watch for.

Post Entry, Not Pre Entry.

UPDATED IRON CONDOR RED FLAG PLAN

I wrote this before I did all of the above

It is not useless, but with a closer strike, I will be cutting trades a lot faster so waiting on a 4hr 50ma is not going to happen.

The 9 though will matter. The 9 and 20 hourly will matter.

-----------------------------------------------------------------------------------------------------------------------

There is a good amount of aniticipating when placing Iron Condor. I have to be ready and think ahead when those flags are going to hit and will I be ready. Sometimes I can give or take a few cents ahead. I have to anticipate a close udner the 9dma. A trend change in 4hr 9ma.

Sometimes If I wait, the RR for the 2nd wing becomes unfavorable. Under .15

Is all these red flags necessary?

Can it be simply based on price alone?

Of course option pricing against me is bad, but if in on T and R sees major downturn, I am not going to see that option price spike to 100% against, or est Risk % against go very far. By the time it does, it will be far too late to put that wing on.

I believe Wing must be put on because of price and technicals. Not my MAE data.

Looks closer at losers and winnners ATR and % against, to stop ratio.

I have separated red flags from Performance, Price based, and then MAE, option / money based.

So in total I have 5 categories.

Performance - Price

MAE - Option Value

Day 2 - Price Action

Volatility - IV/ATR

Technical - MAs

Performance and Technical Being the most important in regards to putting on the wing.

So last month I went through this and discovered that 8 red flags is the number that separates majortiy of winners and losers.

Since then I have found its not that easy.

Mid day these flags pop up and I have to be aware. If im marking these flags after the market closes, well I end up with a MS situation and a 3% gap against and no hedge to help.

Also waiting on MA closes can hurt. Am I really going to watch a weak market, with weak industry fall against me for 3 hours before I wait for a 4hr MA close? Knowing we have already so many reasons against my original thesis?

Am I really going to wait for Day 2 to close and miss that chance already seeing things clearly trend against me?

My problem was, by waiting too long, the hedge is long gone and no longer worth the RR.

So lets do this whole process again.

Avg Red Flags W 13.2

Avg Red Flags L 20.4

Avg Performance Red flags on W 2.1

Avg Performance Red flags on L 4

Avg MAE Red flags on W .6

Avg MAE Red flags on L 1.4

Avg Day2 Red flags on W 1.9

Avg Day2 Red flags on L 2.7

Avg Volatility Red flags on W 1.3

Avg Volatility Red flags on L 1.9

Avg Tech Red flags on W 7.3

Avg Tech Red flags on L 10.4

Try a couple things here.

71 wins 28 losses

Winners with 13+red flags (32)

Winners with 13- red flags (39)

Losers with 13+ red flags (27)

Losers with 13- red flags (1)

Winners with 7+ Technical red flags (44)

Winners with 7-Technical red flags (27)

Losers with 7+ Technical red flags (27)

Losers with 7- Technical red flags (1)

Well..

Only 1 loser had less than 7 technical red flags.

76% of winners had 5 or more tech red flags.

72% of winners had 10 or more red flags.

As far as technicals red flags go. 6 is A warning sign. That combined with other red flags is sign to put it on.

I think a pretty simple way to do it is combine with 3 red flags from performance (-.5ATR from entry price, -1% against entry price, -1% or -2% at any point, halfway to stop) or 3 Day2 red flags (Option close against, VWAP close against, Unhappy with PA, Industry against)

Something that gets me close to 13. 13 Red flags, the condor needs to be on.

When it looks like im going to hit that 13, its time to put it on.

That or 10+ technical red flags.

74% of winners have 10 or less technical flags.

So now to check how it would work.

Winners with 6 tech flags and 13 total flags (39) selling wing against thesis at current week hi/lo

///// ///// ///// ///// /// 59%

So the start of that review did not go well. It wasnt working at all. Then around 16 total red flags it picked up and saw much more working.

So this is getting bumped up.

Last thing I want to do here is erase a good winners chance at being a win and taking an L on it instead.

16 Red Flags, 8 Tech Flags.

67% of winners had less than 16 flags.

Of those 16 only 1 had less than 8 technical red flags.

Est Risk% is triple what it is on others. So they are clearly worrysome trades.

86% of losers had 16 or more red flags

So that means 14% of losers would go un hedged. Fine. These are still high numbers thats just the way it goes sometimes. Goal here is to not take away from my wins and create more losers. Not eliminate my losers entirely.

Winners with 8 tech flags and 16 total flags (24) selling wing against thesis at current week hi/lo

///// ///// ///// ///// (83%)

These numbers are much better.

I like things that lie in the 70%-80% range.

Of my 100+ trades now, only 4 losers would go un hedged and be full losses.

24 losers would turn much smaller. Some to winners.

And 4 of my 71 wins would turn to small losers.

These are good numbers.

16 Red flags. 8 technicals.

Put half the wing on when its obvious the flags are going to hit. Other half on confirmation of PA against thesis.

That can be a pivot break against, a vwap fail, daily level break.

NOW with those numbers in mind. I must also get out of these 2nd wings when appropriate

-----------------------------------------------------------------------------------------------------------------------

The red flags that matter now are on a much short time frame.

This will have to be revisited next month but some I know will matter right away

-Close under 9/20 1hr ma

-Close under 4hr 9ma

-Trend against 9/20 1hr ma

-Trend against 4hr 9ma

-Close against 9dma

Stop is much tighter now, an .5 ATR move against just about is my stop now.

A -1% adverse move is about as far as it can get against me.

A ratio to stop move will be much more common.

Just going to have to wait and see how the data plays out.

--------------------------------------------------------------------------------------------------

And now I finished the above serciton on PBs and MA closes against.

The only ones that seem to matter are 4hr MAs and mainly on Day 2.

Which is good, if Day2 MAs are looking like they are going to close against, i do not need to be adding. if they are going to close in favor, then add.

That combined with my original red flags on MAE peformance now give me my new red flag system.

Volatility red flags dont matter now, closer strike, means out well before those would trigger or at least out near where they would trigger.

My $$$ MAE red flags are going to be different. risk is tighter and will end up giving different % of how close thesee next trades get to that est risk. and % of sold option MAE will i would assume be less likely to get to 100% against.

Removng volatility. Removing Ratio to stop/est risk %/ Sold option MAE for now. Removing lots of technicals.

So heres new possible red flags

Performance

-ATR Against -.5 (Based on Entry Price)

-% Against -1% (Based on Entry price)

- -1% Day (Based on close price)

-Sold option not profitable on day 2

-Day 2 vwap close against

-Day 2 unhappy with PA

-Day 2 poor industry performance

-Day 2 close against at any time 4hr 9ma

-Day 2 close against at any time 4hr 20ma

-Close against 9DMA

-4hr 9ma trend against

-4hr 20ma trend against

What I continue to gather is Day2 is crucial to the trades success.

Start small day 1.

Add small on confirmations.

Add biggest when Day2 confirms more.

If Day 2 is not going well, shoudl look to cut it on

RISK/TRADE MANAGEMENT PLAN

Selection

-Considering my errors in entry, what needs to be avoided here

-Chasing (Stocks that have already made a good move away from consoldation / tight MAs

-DAY 2 'chasing' is OK here I already have a buffer from Day 1 entry

-Ignoring HTF S/R against thesis

As long as these 2 conditions arent there, trade as I have been.

Strike Selection

-Base my strike on the percentages that my winners tend to NOT reach

- -.5 ATR / -1% / Weekly hi/lo / Current Day Hi/Lo

-The middle ground here is the answer

-.35 Min Delta for Flags

- ~.45 Delta for Over Ext

-Not every strike is going to be at weekly hi/lo or prev day hi/lo and thats fine. I have other MAE

Stop

-Stop is based on MAE performance metrics. Not the strike.

- -.5 ATR / -1% / Weekly hi/lo / Current Day Hi/Lo / 100% MAE on Sold Option

-This means some trades will go ITM a bit and that will be fine.

-What NOT fine is holding it much past that.

-My MAE performance metrics tied in with MA closes against would have me out around strike levels majority of the time.

Entry

-At prev days HOD/LOD, or a clear intraday breakout pattern that starts going

-If trade within first 15 of day, can use prev day hi/lo to risk against, then as day progresses and improves, use current hi/lo to add

Profit Target

-Profit target is based on option price, not the underlying

-80%

-Why 80%?

-Because thats numbers I hear SMB / Sang Lucci use.

-Why 80%?

-I dont know

-But if I had to guess, by the time it gets to 80%, at least another day has passed and risk reward has skewed quite a bit to unfavorability to hold to 0.

Adds

-Allowing myself 2 adds on day 1. Both small (1 or 2 contracts).

-1 on a new HOD/LOD break in favor, and another on a clear breakout pattern

-Day 2

-Size is half of total Day 1 size up to triple.

-Adds only if PA is still in favor

-MAs tight and under showing clear S/R in favor

-Prev day/week levels holding

-Add as it continues working

-Add on new HOD/LOD breaks in favor

-Add on successful retests of S/R and turns in favor

Take Profit

-Do Not take off as stock moving against me. Wait for PB in favor.

-Take Profit at 80% all out

Exit Early

-Do Not take off as stock moving against me. Wait for PB in favor.

-Profit or loss does not matter

-If Day 2 action is poor and unlikely to recover near close, exit position

-Need at least 2 of the following to exit early

-If action on any day after is poor exit on technical MA losses

-If action on any day after is poor exit on Prev Days hi/lo breaks against

-If action on any day after is poor exit on MAE Performance red flags

-If action on any day after is poor exit on Current Days hi/lo break against

Exit at Full -1R Loss

-Do Not take off as stock moving against me. Wait for PB in favor.

-Trade must hit at least a few of the following

- -.5ATR from entry price

- -1% from entry price

- +100% on Sold Option

-Break current Days hi/lo against

-Break prevday hi/lo against

-4hr 9MA close against

MARK SLAUGHTER

Who is Mark Slaughter you ask? He is a life changing physical fitness therapist I have been seeing for several months now.

Last week I told him something that I have yet to relate to trading until now.

"You know, I always knew I was close, but you have shown me what that next level is."

He is a mentor.

I do not have a trading mentor.

I never have.

I work hard.

Sometimes thats not enough.

Peter Reznichek?

Sang Lucci?

BULLETS POINTS LEARNED

75% of my winners dont ever break Day of Enrtry Hi/Lo against me.

85% of my winners dont ever break Weekly Hi/Lo against me.

93% of winners have profitable day 2.

82% of trades with profitable day 2, end up winners.

45% of losers have profitable day 2

Day 2 is where the size can be added. This is where I put risk on and add as it continues working and PA remains favorable.

Day 1 is starters. Add as it works. But dont get huge size on all at once. This is how I can make losers smaller. Day 2 is how I add to winners and get the most out of them.

If Day 2 is Unfavorable. That is reason to EXIT the position. 93% of my winners have a profitable Day 2. That is a huge giveaway

OTM is always a risk due to low prem.

Low prem means it can inflate any time easily to breakeven and worse.

Extrinsic value and low intial trade entry prem is cause for a trade to ALWAYS be at high risk.

ATM has a moat.

ATM has higher theta which decays prem faster.

Higher prem means even after an adverse move, the higher theta can still give the trade profit.

Day 2 reversals I can still capture a win with NTM.

OTM trades are only 80%+ profitable on fridays.

A Day2 Add is worth it still with NTM strikes.

-Data shows 75% of winners dont break Day of Entry Hi/Lo against

-Data shows 85% of winners dont break Weekly hi/lo against

-Strikes will be in this area, so Day 2 PA favorable, then still completely valid.

Day 2 Adds will need different management. With lower prem and if trade does turn against, will cause larger losses.

My stat on winners never break hi/lo or weekly hi/lo against has nothing to do with strike selection. That is all data and performance based from there I can pick closer NTM strikes to reflect that.

That stat does mean that those wins still run to 0 and do not come back past sold strike, IF I sold strike at that point.

I am doubling down that it will exp at 0. But Still looking to take profits off at 80%.

90% of all my trades expired at 0 on friday. But that last 10% if held til friday would have made me breakeven.

Strike Selection is based on Data and Chart (MAE performance metrics -.5ATR, -1%, and chart Weekly hi/lo or current days hi/lo)

-When in doubt, pick the closer strike. Stats are favorable for me picking good winners.

Stop is based on Data and Chart. (Red Flags, MAE performance metrics)

Over Ext trades have more of a go and never come back PA.

Flags tend to break DoE hi/lo against me more often.

Over Ext Strike selection can be more aggressive

Flag Strike selection can be looser, based closer to weekly hi/lo

Data tells me that a trade closing against any 1hr MAs an Day1 or Day 2 is normal.

A close against 4hr 9/20MA on Day 1 is a problem.

A close against 4hr 9/20MA on Day2 is a red flag.

I have to be right a little bit better. My calls need to be better/more aggressive. Instead of selling a 135, i have to believe its worth 140 instead and add day 2 like it definitely wont come back.

Heres Groks summarized and organized better

Core Stats and Insights

Day 2 Profitability as Key Signal: 93% of winners have profitable Day 2 action; 82% win rate (60W/13L) if Day 2 favorable—vs. 45% of losers. Only 8% of winners lack this, making it a 90%+ scenario for adding size/confidence. MAE/red flags/volatility similar between Day 2 winners/losers, but technical flags slightly worse in overall losers (due to inclusion).
Winner Reversion Patterns: 70-75% of winners never break Day of Entry (DoE) hi/lo against; 84-85% never break Weekly hi/lo (14-16% do). Breaking entry price common (68-77%) but recoverable; DoE hi/lo breaks low (19-41% bull/bear). Overext setups show stronger "go and never return" (16% DoE break vs. 24-38% flags). Losers: 90% break DoE hi/lo, 97% entry price, 74% weekly hi/lo—often via >1 ATR non-stop moves.
Loser Themes and Frequency: 48% of losses hit on Day 2 (15/31); most directional/aggressive without PBs. 33% "pure" losses; 67% avoidable (chase 33%, news/FED/earnings, ignoring HTF MAs). Exit days: Day 1 (5), Day 2 (15), Day 3+ (11). 90% trades expire at 0, but 10% killers (if held) cost $13K+ vs. $7K actual (early cuts); holding would add $5K more from max L.
Strike and RR Comparisons (from Sims): OTM (15-25 delta): High WR but low RR (0.1-0.25), high max L ($1000+), fragile (easy breakeven on PBs, slow theta). NTM/ATM (35-45 delta): Higher RR (0.5-0.85), lower max L ($500-800), moat from high prem (80% capture ~$460 > OTM full $190), faster theta/vega recovery. Dynamic RR improves mid-trade (e.g., META ATM 67% mid-week > OTM full). Losers: NTM ~1:1 RR (recoverable $300) vs. OTM wipeouts ($3000, dozens of wins to recover).
Expiry and Holding Stats: 90% trades expire at 0, but 10% (if held) turn breakeven or worse—saves $13K on winners but costs $7K+ on losers (up to $5K more if max L). Focus on 80% max P capture, not full expiry.
Red Flag Averages: Winners: 13.2 total (7.3 technical, 2.1 performance, 1.9 Day 2); Losers: 20.4 total (10.4 technical, 4 performance, 2.7 Day 2). 76% winners have 5+ tech flags (normal closes against 1hr MAs); 86% losers have 16+ total/8+ tech. Only 1 loser <7 tech flags.
Setup Variations: Over-extension trades show stronger "go and never return" (lower DoE/weekly breaks: 16-40%); flags break DoE hi/lo more (24-38%)—adjust strikes accordingly (tighter for over-ext, looser for flags).

Strike Selection and Management Applications

Shift to Closer Strikes (NTM/ATM): Sell 35-45 delta (e.g., -0.5 ATR/~1% from entry, or DoE/weekly hi/lo) for moat (high prem offsets PBs), better RR, smaller losers. Base on charts (support levels) + data (MAE stats); closer for high-confidence (overext, 45 delta), looser for flags (weekly hi/lo). Avoid deep OTM (black/grey swans); not pure ATM (too tight, assignment risk).
Strike Basing: Hybrid chart + data: Near DoE/weekly hi/lo, -0.5 ATR/-1% from entry (e.g., META 762.50 at 38 delta). 45 delta for high-confidence (over-ext), 35 for average (flags); when in doubt, closer strike—stats favor it for RR without sacrificing too much WR.
Trade-Offs: Sacrifice WR for bigger winners/smaller losers; eliminates black swans/grey swans (e.g., non-stop moves); reduces stress (cut vs. hold); but increases loss frequency—manage with faster exits.
Sizing and Adds: Start small Day 1 (speculative, OTM/NTM). Add on confirmations (e.g., new weekly hi/lo); biggest on Day 2 favorable (profitable PA, no MA closes against). NTM adds retain ~50% prem (good RR); OTM adds low-RR chases. Avoid Day 1 huge size (reversals hit 48% losses Day 2).
Simulation Takeaways: In winners (META/TSLA), ATM captures more absolute $ faster (e.g., 67% mid-week > OTM full $190); recoveries quick post-PB. In losers (NVDA/MSFT), ATM worsens slower initially (moat effect) but demands fast cuts (1:1 RR losses vs. OTM's smaller wins but wipeout risk); OTM lingers negative longer.
Premium and Theta Benefits: ATM/NTM higher initial prem acts as buffer—even after adverse moves (-0.5 ATR/-1%), theta crushes extrinsic faster, allowing 80% max P (often = OTM full win) with less risk/stress. Day 2 adds retain $ value (not cents like OTM).
Exits and Goals: Aim 50-80% max P mid-week (theta warrior; 80% NTM > OTM full with less stress). No need for 100%/expiry at 0—focus RR/money, not perfection. Cut losers fast ("run, don't walk"): at stops (DoE hi/lo break, -0.5 ATR/-1%), breakeven post-PB, or red flags. For NTM: Exit before deep ITM (delta amplifies); hold if theta buffer allows small win.
Product Fit: Spreads ideal for swings (time/theta in favor, easier "won't be here" guesses). Avoid shares (overnight risk), straight OTM buys (timing/pullback kills), naked sells (black swans). NTM suits: Faster cuts, no "decay limbo."

Risk Management and Exits (From Loser Reviews and Red Flags)

Stops and Exits: Based on chart/data (not just strike): -0.5 ATR/-1% from entry, DoE hi/lo break against, poor Day 2 PA. "Run, don't walk" on trouble—exit before strike test to avoid ITM escalation/assignment. No holding past sold strike long; aim 50-80% max P mid-week (e.g., Day 2-3).
Adding Size: Start small Day 1; add incrementally on confirmations (e.g., new hi/lo); biggest on favorable Day 2 (profitable, MAs in favor). Avoid Day 1 huge size (reversion risk); Day 2 adds valid if <50% prem gone and PA strong.
Holding Philosophy: No need for 100% capture/expiry at 0—80% on ATM beats OTM full with less limbo/stress. Focus on RR trades making money, not perfect timing; spreads suit your swing style (time in favor).
Avoidances: No trades on FED/earnings/volatile weeks (e.g., MS 7/29 gap); avoid chase/emotional hedges (e.g., DE 8/7); wide-spread names (DE/LMT); ignore HTF trends.

Red Flag Evolutions

New System Focus: Post-entry only (pre-entry via setups). Prioritize technical (MA closes/trends) + performance/ Day 2 (e.g., -0.5 ATR, Day 2 4hr 9/20MA close against). Threshold: 16 total/8 tech flags = hedge (wing at opp hi/lo); 70-80% success in turning losses small/wins intact. Day 1 4hr MA close against = early problem; Day 2 = exit signal.
What to Track: Performance (-0.5 ATR/-1% from entry, -1% day); Day 2 (sold option unprofitable, VWAP/PA/industry against, 4hr MA closes); Technical (1hr 9/20MA closes, 4hr 9/20MA trend/close against, 9DMA close, DoE/weekly hi/lo break). Scrap volatility/ratio (NTM exits before); refine MAE for NTM (tighter % est risk).

Goals and Next Steps (from Last/Next Month)

Last Month Achievements: Redid stats (W/L bear/bull, flag/overext); confirmed closer strikes via winner reversions; explored Day 2 + cross-stats (e.g., no major IV/delta ties); refined red flags (4hr MAs key); tested iron condor at 8 flags (but bumped to 16/8 for better WR preservation).
Next Month Focus: Test % max P targets (50-80%); integrate strike pegger/max pain; evaluate Day 2 adds (RR on PBs/chases, rules: <50% prem gone, great PA); revisit ratio/est risk/sold MAE for NTM; new red flag thresholds (e.g., 6/12 total?); candle types/prev tops/bots; split long/short/range/overext deeper.

Final Bullet Points and Takeaways

Day 2 as North Star: 93% winners profitable Day 2 (82% WR if so)—add size here, exit if not; counters Day 1 over-sizing (48% losses Day 2).
NTM Strike Shift Wins: 35-45 delta for RR 0.5+ , moat (high theta/prem buffers PBs), smaller max L/recoverable losses ($300 vs. $3000 OTM); 80% capture > OTM full, faster exits reduce stress.
Winners' Edge: Rare deep reversals (70-85% no DoE/weekly breaks)—select closer strikes confidently; overext > flags for "never return" PA.
Loser Prevention: 67% avoidable (chase/news/HTF)—filter pre-trade; cut at -0.5 ATR/-1%/flags; 90% expiry misleading (focus 10% killers via hedges).
Red Flags Refined: Day 2 4hr MAs key—post-entry, risk-first to avoid waits.
Management Mantra: Start small, add on proof, take 50-80% profits, run from trouble—no forcing expiry; spreads + NTM = theta/time in favor.
Long-Term Mindset: Sacrifice WR for consistency/RR; explore vega/max pain; no volatile weeks—patience builds edge.
Takeaway: Your system's sweet spot is setups + NTM management; data shows 70-85% resilience in winners—lean in for sustainable growth.

LAST MONTH GOALS

-Record / find data on candle type prev day/days.

-Red, Green, doji, hammer, ranges

-How many days ago was most recent top/bot

-Did not do any of this, was not the main focus. Push to next month

-Split Stats into Long/Short, Range/ Overext

-Did this for review and found good data.

-Do stat review all over again at EOM

-Yes

-If Winners rarely go X against me, doesnt that mean I should be selling closer strikes?

-Yes

-What cross stats can I look at.

-ATR and Breakout in favor?

-IV range and Delta?

-Day 2 favorable action and something else

-This is kind of pointless now. With me selecting different strikes, this will change the data completey. Need a couple of months before I do this again.

-Look at Frequent Day % again with bear and bull

-I Did at beginning of month and found nothing. Eliminated from recording.

-Keep track of red flags and see which align with 4hr MA red flags.

-A 4hr trend against means we have spent time moving against idea.

-An atr move or % to stop can happen in a flash and recover no problem.

-Some red flags involve time, while others are just a price point.

-Yes

-Create new tab that shows only red flags and check boxes

-Yes but able to put all in 1 sheet.

-Check past trades if 2 red flags occured, and I sold opp end of range opposite to make Iron Condor work?

-Yes but irrelevant

-Formulas for Technical Stat review were wrong. Redo near end of month.

-W L Bear Bull Flag OverX

-Explore Vega

-Explore idea. When stock is 50% to stop, chances are that also means that option is near 100% against, ATR is around 50% against. Against trade -1%. How are these relatable.

-Winners with Favorable Day 2 action

-Ever broke Day of entry hi/lo against?

-Ever broke Day 2 hi/lo against?

-If not, can add with strike at that hi/lo

-When a trade hits 8 red flags, we are now on Iron Condor entry mode. When a technical red flag pops up, thats my first in. When it proves itself ugly again (MA reject, VWAP reject, Prev S/R reject, Failed BO in favor. New LOD/HOD against) , add the rest to match.

-How is this trading plan working.

-Not well enough. Scrapped.

What a few months this has been. Huge sorting effort to nail this down.

It still feels right. Feels like im on the right path still.

My whole career has always been stack as many variables as you can in you favor.

Credit spreads and the greeks continue to show me this is what I should be doing.

Its more variables in my favor with added benefit of sales.

My understanding of decay has been key.

I had a thought the other night.

Back when I was in physics in college, we had a lesson on speed and velocity and acceleration

We have 3 degrees here.

1st degree is speed

2nd degree is velocity

3rd degree is acceleration

Velocity is a derivative of speed

Acceleration is a derivative of Velocity

Acceleration is what I am doing here.

Capitalizing on, in my case, DEceleration as prem decays as stocks move in my favor.

I am still trading breakouts, just using different vehicles.

The breakout accelerates the option price.

Which decelerates the opposite end and requires even more acceleration to get it back.

Which is where my edge is.

These are still range expansion trades, just selling them, not buying them.

Catch the wave, cash out on momentum

TL;DR

Sell closer strikes as data has shown me

Best Winners go and never come back

RR > WR

Day 2 is key for size

Dont worry about exp at 0

Take 80% profits

Decay is king.

NEXT MONTH GOALS

What is good aim for % of MaxP

Theta Warrior. What does this mean.

What really is Vega? Why does Grok keep bringing this up I am missing something here?

Where does Strike Pegger/Max Pain/Min Pain fit in all this?

What does the word acceleration mean in my trading?

How are Day 2 adds working?

-In terms of chasing, RR, pb adds.

Day 2 Add rules. What are they

-Breaks in favor, not more than 50% prem gone, great PA.

Revisit

-Ratio to Stop

-% MAE on Sold Avg for losers.

-Est Risk %

Stop

-More data on ATR and % to stop and MAs

-To find better red flag system and re compare what winners have in common

What are new counts for red flag troubles

-6/12? 4/12?

Explore Small Cap Episodic Pivots?

Separate Stat Recording into Day 1, Day 2, 3 etc

-Dont take the average.

Explore Day 2 RR when trade moves in favor

-What questions need asked?

-Even after a big move, is NTM still worth adding with good RR?

-Avg RR on Day 2 adds

-Goal is 80%, so when at 50% of Day 1 prem, there is still 30% left?

Shadow Trader / Peter Reznichek

At what point does the trade definitely not going to break prev day vol to show a top or bot.

-Rel Str past days time.

-Vol at ToD

-Record / find data on candle type prev day/days.

-Red, Green, doji, hammer, ranges

-How many days ago was most recent top/bot

-Explore idea. When stock is 50% to stop, chances are that also means that option is near 100% against, ATR is around 50% against. Against trade -1%. How are these relatable.

Just keep rolling the ball.

Search This Blog

Just a Day Trader

August 2025

Do I Base My Strike on the Chart?

Do I Base My Stop on the Chart?

Do I Base My Stop on the Strike?

Do I Base My Strike on My Data?

Final Recommendation

Core Stats and Insights

Strike Selection and Management Applications

Risk Management and Exits (From Loser Reviews and Red Flags)

Red Flag Evolutions

Goals and Next Steps (from Last/Next Month)

Final Bullet Points and Takeaways

Comments

Post a Comment

Popular posts from this blog

Trading Plan

MTX

11/30 DRC