FACT: The S&P hit its current low on 03/23/20.
FACT: 28 days after 03/23/20 is 4/20/20. FOUR-TWENTY! It’s destiny!!
FACT: 2,792 is a 50% retracement level. I’m not saying retracement working is a fact. I’m saying 2,792 is the 50% retracement level.
We’re basically at 2,792 now so it seems like a great time to switch to puts expecting a retest of 220 on or around 4/20/20. So what do we buy?
Well, we don’t want theta decaying us in the ass so when we sell these puts since we’re not holding to expiration, we want 30-45 DTE. 45 days from 04/20/20 is 06/04/20. That means 06/19/20 expiration or 06/30/20 expiration.
Personally, I’m taking the 06/30/20 because I want extra time for this to happen just in case the market isn’t so easy that some random guy can make money this easily.
CONCLUSION:. 240p 6/30 with the intention of selling once SPY hits 220 or maybe 228 because the retest would come within 4%. I could do a 230p but I’m worried full retest won’t happen because of Powell doing Powell things so I want my strike closer to being ITM right now.
They’re selling for ~$9.00 each and I’m hoping to sell ~$27.00.
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.