I’m sure you know how much I love using butterflies to trade. Historically, I’ve used this strategy for swing trading equities, especially on high-volume tickers with liquid options markets, states Danielle Shay of Fivestartrader.com.
That includes tickers like Amazon (AMZN), Microsoft (MSFT), Tesla (TSLA), Apple (AAPL), and more.
SPX 0 DTE
But I’ve continued to hear from my colleagues how useful trading the SPX is, especially on a zero-day expiration (0 DTE) basis. Because the SPX has a series in which the options expire daily, options traders can take advantage of quick theta decay, especially if they know how to use options strategies like butterflies, credit spreads, and iron condors.
Combined with an expert reading of price action, these strategies can equal some great opportunities at the end of the day. As someone who’s always loved trading the last hour before the market closes, applying my options strategies to this ticker is something I have come to enjoy.
Your Requests
A few weeks ago I sent out a request via this newsletter, asking traders what they’d most like to see me make videos about. Overwhelmingly, the response was that traders wanted to see me make more videos about how I trade butterflies, and specifically about how I manage real trades. As such, I started a series on my YouTube channel called Trade Review. Now, I normally don’t like ‘bragging’ about trades because I think it gives me bad luck, but I started this series because it was specifically requested and I think it does provide real insight into how and why I enter trades, and how they play out.
Here is a video I made on Tuesday about my end-of-day SPX butterfly. This is a trade I did live in the Simpler Trading Simpler Central trading room. So, if you want to see the full version and you’re a member, check out the recording of my trading room session at the close.
Learn more about Danielle Shay at Fivestartrader.com.
