Get started
S&P 500 IndexS&P 500 IndexS&P 500 Index

S&P 500 Index

No trades
See on Supercharts
Overview News
Ideas
Discussions Technicals Seasonals

SPX500USD trade ideas

S&P500 INTRADAY resistance at 5670Tech Surge Lifts Markets: Strong earnings from Microsoft (+7.8%) and Meta (+6.2%) are driving early market optimism. Both beat revenue expectations, easing concerns about trade war impacts. → S&P 500 futures up over 1%. Trade Deal Hopes: Sentiment is boosted by signs that President Trump may soon announce initial trade agreements, reducing geopolitical risk. Bank of Japan Dovish Shift: The BoJ cut its growth forecast and delayed its inflation target, signaling caution. Yen fell as much as 1.2%. US-Ukraine Investment Deal: The US secured privileged access to Ukraine’s natural resources, potentially helping ease tensions as part of broader efforts to end the war. Earnings Watch: Before Open: Mastercard, Estee Lauder, Eli Lilly, Moderna, McDonald’s After Close: Apple, Amazon, Amgen, Airbnb, Reddit Key Support and Resistance Levels Resistance Level 1: 5670 Resistance Level 2: 5740 Resistance Level 3: 5820 Support Level 1: 5440 Support Level 2: 5385 Support Level 3: 5316 This communication is for informational purposes only and should not be viewed as any form of recommendation as to a particular course of action or as investment advice. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. Opinions, estimates and assumptions expressed herein are made as of the date of this communication and are subject to change without notice. This communication has been prepared based upon information, including market prices, data and other information, believed to be reliable; however, Trade Nation does not warrant its completeness or accuracy. All market prices and market data contained in or attached to this communication are indicative and subject to change without notice.
TRADENATION:US500
by TradeNation
SPX Play-by-Play: From Trap to Trend and Back AgainJust price, structure, and volume — tracked in real time. 🧠 Chart Breakdown: ✅ Early Short Trap / Failed Breakdown — Sellers tried to press lower early, but price held key levels and reversed. That shift became the foundation for the entire move that followed. ✅ Breakout Long Trigger — After reclaiming structure, price drove into new highs with strong follow-through. Volume confirmed the breakout. ⛔ Top Rejection — Price pushed into resistance but couldn’t hold. Momentum faded, candles hesitated, and sellers stepped in. ✅ Fib-Based Bounce — After the pullback, price responded cleanly off fib-based support. The bounce was sharp, and volume backed it. ✅ Steady Uptrend Structure — Price moved in an orderly fashion. Small pullbacks held structure, and volume stayed supportive — a textbook controlled climb. ⛔ Range Resistance — Price returned to a previously rejected zone. Wicks and hesitation reappeared. 👀 Current Breakout Watch — Price is testing that resistance again. A reclaim with strength signals continuation. Another fade? Let it go. Always happy to be helpful.
SP:SPX
by tradingqueen1980
SPX ready for the correctionhi traders, This is probably not what most traders want to see but we must be realistic. The monthly close is upon us and it's not gonna be a bullish close. A lot of selling pressure and it may be just the beginning. A 13 % correction on SPX is more than likely in my opinion. If the price loses the upsloping support, we will see the mark-down pretty soon. Stoch RSI suggests that the bears are taking control. My target for SPX is between 5200 and 5000. Get ready to buy cheap stocks and cheap crypto!
SP:SPXShort
by vf_investment
4
US500 - Long-Term Long!Hello TradingView Family / Fellow Traders. This is Richard, also known as theSignalyst. 📈US500 has been overall bullish trading within the rising channel marked in blue. Moreover, it is retesting its previous all-time high at $4,800 and round number $5,000. 🏹 Thus, the highlighted blue circle is a strong area to look for buy setups as it is the intersection of previous ATH and lower blue trendline acting as a non-horizontal support. 📚 As per my trading style: As #US500 approaches the blue circle zone, I will be looking for bullish reversal setups (like a double bottom pattern, trendline break , and so on...) 📚 Always follow your trading plan regarding entry, risk management, and trade management. Good luck! All Strategies Are Good; If Managed Properly! ~Rich Disclosure: I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
TRADENATION:US500Long
by TheSignalyst
4
Please criticise on this strategy using SPXI have not backtested this strategy and to use the "REPLAY" button would costs me some money so you can say, it is biased since the candles were already formed ahead. Strategy - Time frame - 1H Risk/Reward - Keep to 1:2 strictly Example : Trade Setup 1 11 Apr 25 candles closed above 10 Apr 25 - LONG SL at closing of 10 Apr Profit target - 1 : 2 You can see that you are stopped out AFTER you set up Trade set up 2 (21 Apr red candle), ie 10 days later , you are in a LOSS position. Trade setup 2 - Long on 17 Apr got stopped out on 21 Apr when it gapped down. See the power of having a SL else your losses will magnified overnight!!!! So in this chart, there were 5 trades, 3 in profits and 2 in losses. Overall, you gained because your rewards are 2x so in this case you won 3 multiply by 2x = 6x but your losses are 1x or 3 multiply by 1x= 3x so nett off you gained 3x I would avoid using leverage to trade and keep to the strict rules of 1- 2 trades per week and strictly 1:2 risk/reward ratio. Of course , if you manually watch the chart live (meaning you need to stay awake to glue on the computer) you might gained more than 1:2 risk/reward but that is not the essence of this strategy. Keeping the frequency low tame your emotions (greed) of increasing your position size and risk/reward. What you want is CONSISTENCY not huge spike up and down. Don't think you can make 5x in a day and go on holidays for the next few days. You gotta put in the work (sufficient charting skills allow you to be more nimble and confident but not to inflate your ego by excessive trading). I suggest paper trade for a good 1-2 months and see the results yourself BEFORE you say it work or doesn't. Paper trade is good especially for beginners but once you surpassed this stage, I think using your own money to trade is the real game. Staring at 10% loss is very real and some can take it well while others can't handle it and will manually adjust the SL or PT to modify the strategy. Keep it simple until you gained consistent profits. As usual, please DYODD
SP:SPXLong
by dchua1969
S&P500 INTRADAY resistance at 5510A wave of earnings reports is due today, with Microsoft and Meta in focus. The tech sector remains under pressure, highlighted by a 15% drop in Super Micro Computer after disappointing results. In Europe, banks are seeing strong revenue growth, benefiting from recent market volatility linked to Trump’s trade policies. However, Mercedes and Stellantis have joined the list of companies withdrawing guidance due to uncertainty. Donald Trump has again criticized Fed Chair Jerome Powell and defended his tariff strategy during an event marking his 100th day in office. Investors are now awaiting key US data, including inflation and GDP figures. Meanwhile, China’s factory activity has contracted to its lowest level since December 2023, signaling the early impact of US tariffs and increasing pressure for government stimulus. US consumer companies are also sounding cautious, pointing to a weaker economic outlook ahead. Key Support and Resistance Levels Resistance Level 1: 5670 Resistance Level 2: 5740 Resistance Level 3: 5820 Support Level 1: 5380 Support Level 2: 5310 Support Level 3: 5236 This communication is for informational purposes only and should not be viewed as any form of recommendation as to a particular course of action or as investment advice. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. Opinions, estimates and assumptions expressed herein are made as of the date of this communication and are subject to change without notice. This communication has been prepared based upon information, including market prices, data and other information, believed to be reliable; however, Trade Nation does not warrant its completeness or accuracy. All market prices and market data contained in or attached to this communication are indicative and subject to change without notice.
TRADENATION:US500
by TradeNation
Will April Close with a Bang?You ever get that feeling the market’s just waiting for a reason to move? That’s where we are. It’s been a quiet start to the week – barely a pulse. And Tuesday? One signal. Just one. But it was a bullish pulse bar, and it paid. Price is still coiling, compressing tighter, and Bollinger Bands are pinching harder than a crab on Red Bull. We’re seeing the classic signs of range contraction – which usually means a range expansion is coming. So what’s the move? Stay bullish. Stay patient. And be ready to pounce the moment price breaks free. Today’s calendar gives us a few nudges – ADP, GDP, ECI, PCE – nothing major, but enough to cause a wobble or spark. The bias is bullish. The system’s ready. And if we break out of this pinch, I’m looking at 6106 on the swing. Even a dip to 5400 wouldn’t change the structure – just another spot to reload the bulls. Let’s finish April strong. Let’s grab another one by the horns. --- SPX Market View Let’s call it like it is – the market’s been locked in a deep freeze. Monday and Tuesday barely moved. Why? No real news. Month-end positioning. And a crowd of big players too busy doing their internal accounting gymnastics to push buttons. But while it looked like nothing happened, Tuesday’s single bullish pulse bar delivered the goods. One bar. One setup. One result: Profit. Now as we roll into Wednesday, things get spicy – not because the economic data is explosive… but because compression like this doesn’t last. The Bollinger Band width is pinched tighter than a tax refund cheque. And we know what that means: Tight range = pressure building. Breakout = opportunity waiting. So today’s plan? Stay bullish until proven otherwise. Use the pulse bar system to play range edges or trigger entries. Look for breakout confirmation to ride it toward 6106. Remain calm if we dip toward 5400 – structure still holds. Economic data today (ADP Jobs, GDP, Employment Costs, and Core PCE) might trigger volatility, but it’s not about reacting to the numbers… It’s about watching how price responds. We’re not forecasting. We’re not feeling. We’re waiting for the setup – then pulling the trigger. Price is whispering right now. Soon, it’ll yell. Be ready. --- Expert Insights: Mistake #1: Assuming news equals movement. Just because data drops doesn’t mean price pops. Fix: Always wait for price confirmation. Pulse bars > economic guesses. Mistake #2: Ditching the bias at the first wobble. A dip isn’t a collapse. Fix: Know your structure. Dips to 5400 are still within a bullish regime. Mistake #3: Forgetting the role of compression. Tight ranges often precede big shifts. Fix: Don’t ignore the squeeze. Bollinger Band pinch = breakout fuel. --- Rumour Has It… In a desperate bid to solve market stagnation, Wall Street has reportedly hired a motivational speaker named Terry the Turnaround Candle. His credentials? He once convinced a doji to become a dragonfly. Sources say he opens every session with, “Are you going to let that Bollinger Band define you?!” Meanwhile, the Fed is beta-testing new AI price models based on squirrel hoarding patterns in Central Park. Traders remain cautiously optimistic. Squirrels remain heavily long acorns. This section is entirely made-up satire. Probably. --- Fun Fact Did You Know? The term “month-end rebalancing” sounds official… but it’s really just fund managers shuffling things around so their spreadsheets look prettier. They often trim winners, pad laggards, and balance sector weights. But in low-volume markets like this week, even tiny shifts can cause weird little waves that trigger setups. So when price “randomly” spikes or dips late in the session on month’s end? It’s often not news – it’s bookkeeping chaos in disguise. Which is why we trust setups, not headlines.
SP:SPXLong
by MrPhilNewton
Grab Some Points To Upside In SPX/USD $$$Hey fellow traders and followers! How go's the profits so far? Market movin & groovin to the beat of the Orange drum. I'm here to help if you are having any troubles or confusion with SPX. Let's have a quick look. We have a V pattern in the 1hr chart so let's trade this baby! Breakline is 5530.3 so we wait to see a break above before getting long. Pattern support is around 5510, a break below that price area would likely cancel out the bullishness of this pattern so keep eyes on that. Daily low support sits around 5484.9. A break below that support spells a short down for 29 points. A break above the breakline is a long good for around 29 points. RSI is 55.77 (Bulla). Easy money if the V gets flyin $$$. Don't listen to any news or rumors, listen to your charts. Wait! Did you hear that? Your 1hr chart is whispering something about easy money if you pay close attention to the numbers and the rules laid out within. Hey! best of luck in all your trades people ! Wishing all of you prosperous trades. $$$
OANDA:SPX500USDLong
by Trade-Farmer
1
S&P500 INTRADAY resistance at 5510Earnings season heats up with major companies like Visa, Coca-Cola, Starbucks, UPS, and Pfizer reporting results. In Europe, HSBC announced a $3 billion share buyback, while BP shares dropped due to weaker cash flow. In Canada, the Liberal Party is set to win a fourth term, but likely without a majority, which could lead to a coalition-style government. Meanwhile, the Trump administration plans to ease auto tariffs on foreign parts used in U.S.-made vehicles, boosting Ford and GM shares in premarket trading. Market Impact: Watch for shifts in trade-sensitive sectors, supply chain plays (especially in tech), and defense stocks as geopolitical risk evolves. Key Support and Resistance Levels Resistance Level 1: 5670 Resistance Level 2: 5740 Resistance Level 3: 5820 Support Level 1: 5380 Support Level 2: 5310 Support Level 3: 5236 This communication is for informational purposes only and should not be viewed as any form of recommendation as to a particular course of action or as investment advice. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. Opinions, estimates and assumptions expressed herein are made as of the date of this communication and are subject to change without notice. This communication has been prepared based upon information, including market prices, data and other information, believed to be reliable; however, Trade Nation does not warrant its completeness or accuracy. All market prices and market data contained in or attached to this communication are indicative and subject to change without notice.
TRADENATION:US500
by TradeNation
Trading the Impulse Rally Retracement — Price and Time Symmetry Fundamental — Trend is observed from an impulse run’s lowest/highest point and projected outwards in symmetrical fibonacci retracement via price/time from the first reversal candle to the end of the rally, creating crosshairs. These ‘crosshairs’ visually represent the trending ‘price distribution projection’ in price/time symmetry. Using this concept, I draw a ‘projection trend line’ from the bottom or top of the impulse run thru the projected 78.6% price/time retracement value, to identify the price distribution structure in a linear form. Now to introduce my STOP LOSS TRIANGLE. This is a concept of decaying price and time as an underlying move towards our theoretical projection, where if the underlying enters our built faded cross-section, the SL is triggered to avoid sideways consolidation and decaying contract premiums. This ‘right’ triangle that is ‘sclene’ by nature is created by taking the furthest projection in price/time symmetry (78.6%) and drawing a vertically placed straight line to the highest/lowest point in the rally previously identified. Here, I create a ‘right triangle’ by turning 90 degrees towards my final point, which is made by the nearest projection in price/time symmetry (38.2%). In its entirety, this forms the stop loss triangle
SP:SPX
by splitmyIVandmelt
2
SPX 500 turns lower ahead of busy weekAhead of a busy week, the S&P 500 has found resistance at a key area of resistance near 5550. The Index had rallied in the previous three sessions, but with trade and economic uncertainty still at the forefront, investors are not rushing to chase this rally - and rightly so. May be they will still buy the dip as we head deeper into the week, though, given Trump's change of tone and optimism surrounding trade deals. For me the key support area to watch is around 5,300, but other areas of support including 5840 and 5400. Beyond trade negotiations and trade concerns, a flood of traditional economic data is set to be released this week. Key highlights include PMI surveys from China and the US, first-quarter US GDP, the Bank of Japan’s policy meeting on Thursday, and the critical US nonfarm payrolls report on Friday. On top of all that, it’s the biggest week of earnings season, featuring results from Microsoft and Meta after Wednesday’s close, and from Apple and Amazon—four members of the so-called “Magnificent Seven”—reporting on Thursday. By Fawad Razaqzada, market analyst with FOREX.com
FOREXCOM:SPX500
by FOREXcom
April 28, 2025 - Broken Supply Chains, and the DC CircusHello everyone, it’s April 28, 2025. The week ahead promises to be spectacular (or a complete disaster) depending on which way the wind blows out of Washington. So far, the futures are down about 0.6% this morning, as everyone’s trying to cut risk ahead of a week crammed with Big Tech earnings ( NASDAQ:AAPL , NASDAQ:MSFT , NASDAQ:AMZN , NASDAQ:META ), a mountain of macro data (PCE, GDP, ISM, jobs), and of course, the never-ending Trump tariff soap opera. On the US politics front, Trump stayed uncharacteristically quiet over the weekend, no new bombshells. But whispers about “talks” with China surfaced, without any real confirmation. Meanwhile, several countries are supposedly rushing to negotiate tariff deals with the US. Expect headlines (and chaos) throughout the week. Supply chains are starting to crack. Container traffic from China to the US has plunged 60%, and if deals aren’t made by mid-May, we could be staring down empty shelves and layoffs in transport and retail sectors. Think “Black Friday” without anything to buy. Meanwhile, the drama at the Fed continues. Kevin Warsh, still salty about not replacing Powell, attacked the Fed’s “media circus” style, blaming it for post-Covid inflation. Warsh wants the Fed to go old-school: shut up, protect the dollar, and stop playing superhero. No forecasts, no endless press conferences. Just cigars and silence. On the macro side, this week’s economic data could turn into a horror show: weak jobs numbers, soft GDP, slowing PCE, all raising the probability of recession. If that happens, expect markets to start begging the Fed to cut rates sooner rather than later. Assets snapshot: • BLACKBULL:WTI : $63.36 • OANDA:XAUUSD : $3,307 • INDEX:BTCUSD : $94,000 In short: expect maximum volatility, endless surprises from DC, and a market that could spin on a dime. Stay sharp, stay skeptical, and brace for anything.
SP:SPX
by SmartApingAI
SPX: confusion will continueFinally some positive sentiment on the US equity markets. The S&P 500 marked a weekly gain of 4,6%, while investors are waging the relaxation of the ongoing trade tariffs war. Regardless of estimates of the future impact of imposed tariffs, the US tech companies are still posting relatively good results. The S&P 500 ended the week at the level of 5.525, which was the market low in March and beginning of April this year. Alphabet gained 1,5% during the week, on the wings of posted relatively good results above estimates. Other big tech companies were also supported, like Tesla, Nvidia and Meta. Only on Friday, Nvidia gained 4,3%, while Tesla advanced by 9,8% within one day. Regardless of positive weekly results, it is still not time to celebrate. The news regarding trade tariffs coming from the US Administration still continues to be mixed, bringing a high level of confusion among market participants. In this sense, it could be expected that volatility on the equity markets will continue also in the future period.
SP:SPX
by XBTFX
Bearish WXY Model Forming at Key Resistance – Caution at the TopSP:SPX just crossed the Monthly High, but the structure resembles a bearish WXY correction, and we’re now approaching critical levels. 🔍 Key Levels to Watch: 5481–5572: Weekly FVG resistance + 61.8% Fib Extension – potential top of the rally. 5293: The 50% retracement from the Apr 20 low – a break below confirms the bearish WXY and opens the door to new lows. 📌 Scenario Outlook: ✅ Bullish case: Room for upside toward 5685–5750, but only if we close above 5572 Weekly to invalidate the FVG. ⚠️ Bearish case: Current price action aligns with divergence (as seen with DJI) + WXY model. Caution advised — rallies may be fading. 💬 Chart attached shows the WXY structure forming with key divergences.
SP:SPX
by SmartSignalss
S&P 500 tests key resistance as trade uncertainty continuesTrump continues to say positive things - just now suggesting that they are very close to a deal with Japan on tariffs. But it is China where the bulk of uncertainty lies. He has been quite upbeat this week, but China continues to push back against the optimism. European indices extended their gains, buoyed by the previous day’s upbeat mood, while US futures have given up their earlier gains. The shift likely linked to an interesting interview US President Donald Trump gave to Time Magazine. While Trump claimed Chinese President Xi had personally rung him — and insisted that negotiations with Beijing were progressing — it was his remark that he’d consider “50% tariffs a year from now” to be a success that seemed to spook investors. Unsurprisingly, that struck a more hawkish tone, nudging some traders to lock in profits. Earlier in the session, risk appetite had been given a lift after reports surfaced that China was weighing tariff exemptions for select US imports. This, combined with upbeat comments from Trump the day before and a solid set of earnings from Alphabet, helped extend the rally in equities. Gold, meanwhile, gave back some ground — dipping below the $3,300 mark — as safe haven demand cooled in response to the renewed optimism. Yet, beneath the surface, caution remains palpable. Trump’s off-the-cuff comment about 50% tariffs a year from now served as a stark reminder that nothing is set in stone, and that the trade saga is far from over. As such, while some of the worst risk-off flows may be behind us, it’s far too soon to declare an end to the market turmoil. A period of consolidation — both in equities and gold — may now be on the cards. Meanwhile the S&P 500 has entered a key area of resistance between 5490 to 5550 area. A bearish trend line also comes into play. A clean break should be positive from a short-term point of view, while a sharp rejection is what the bears would be looking for. By Fawad Razaqzada, market analyst with FOREX.com
FOREXCOM:SPX500
by FOREXcom
Built Up Swing Short Bet Over the Last Day.Got another good chunk of the rally taking our net SPX long earnings to over 20% for the year on low risk (For context, our max DD is about 1/4 of what SPX is down this year). I still would prefer to see 5800 for me to take a real big swing at the short (because I know at 5800 even if I am wrong I'll generally get some reaction to size down a bit in risk) but we may undershoot that. I've build up my position around the 5400 sort of area. Small tolerance for stop zones. If I am wrong, I think 5800 would hit really quickly. Update to below idea.
SP:SPXShort
by holeyprofit
5
S&P500 INTRADAY resistance at 5510Global Trade & Geopolitics China may suspend steep tariffs on some U.S. imports, like medical equipment and ethane, to ease pressure on key industries—hinting at a more pragmatic trade stance. Apple plans to shift most U.S. iPhone production to India by late next year, while Walmart is helping Chinese exporters sell locally—both reflecting efforts to reduce reliance on China. U.S.-Russia-Ukraine: The U.S. will push for Russia to recognize Ukraine’s right to its own military in any peace deal. However, Trump suggests Ukraine may have to cede some territory. Meanwhile, reduced U.S. aid is increasing Ukraine’s exposure to Russian cyberattacks. Market Impact: Watch for shifts in trade-sensitive sectors, supply chain plays (especially in tech), and defense stocks as geopolitical risk evolves. Key Support and Resistance Levels Resistance Level 1: 5510 Resistance Level 2: 5660 Resistance Level 3: 5790 Support Level 1: 5110 Support Level 2: 4950 Support Level 3: 4815 This communication is for informational purposes only and should not be viewed as any form of recommendation as to a particular course of action or as investment advice. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. Opinions, estimates and assumptions expressed herein are made as of the date of this communication and are subject to change without notice. This communication has been prepared based upon information, including market prices, data and other information, believed to be reliable; however, Trade Nation does not warrant its completeness or accuracy. All market prices and market data contained in or attached to this communication are indicative and subject to change without notice.
TRADENATION:US500
by TradeNation
Option Insights – Trading the Greeks Part 3 of 4: Gamma ScalpingOption Insights – Trading the Greeks Part 3 of 4: Gamma Scalping Gamma Scalping is a trading strategy that combines long option positions with a hedging position in the underlying asset to isolate and profit from the convexity of options. It is essentially a non-directional swing trading strategy that aims to capture price swings—regardless of direction—by neutralizing the linear component of option value changes and focusing on the convexity gains. ________________________________________ How It Works Gamma Scalping begins by purchasing a single option or a strangle, and simultaneously entering a hedging position in the underlying to achieve Delta neutrality (the "Delta hedge"). The strategy then waits for a swing in the underlying price in either direction. Because of the long Gamma position, the position’s value is a convex function of the underlying price. This means that the position will either: • Gain more than the Delta hedge in a favorable move, or • Lose less in an adverse move. The combined position becomes profitable as the underlying moves, regardless of direction. The linear component of the option’s value change—driven by Delta—is hedged, so any residual profit comes from the convexity, i.e., the Gamma. To realize this convexity profit, the Delta hedge is re-adjusted after the swing has played out. In other words, after the market appears to have reached a turning point, the position is brought back to Delta neutral. The optimal adjustment points are at the sequential peaks and troughs of the market. Rebalancing at intermediate points captures some convexity value, but typically less than adjusting only at clear turning points. This is illustrated in the two subcharts of the introductory chart. ________________________________________ How Does Gamma Scalping Make Money? The change in the value of an option due to a change in the underlying price is approximately the sum of the Delta-weighted change in the underlying (the linear portion) plus a Gamma-weighted convexity component (convexity portion). • The linear portion is hedged by the underlying. • The convexity portion remains and represents the profit opportunity. While the convexity component is typically smaller than the potential linear gain, it is always positive—unlike the linear term, which is only profitable when the direction is predicted correctly. ________________________________________ What’s Being Traded? Gamma scalping involves adjusting the hedging position—not the options—at perceived turning points in price swings. The options position is kept intact as long as it maintains sufficient Gamma to deliver meaningful convexity. Even in volatile markets that demand frequent trading, all activity is confined to the underlying, which tends to be liquid and low-cost to trade. Once the option’s Gamma decays significantly, the entire position (options + hedge) may be reset to “refresh” the Gamma exposure. ________________________________________ What’s the Catch? The convexity value isn’t free—it comes at the cost of time value decay, as measured by Theta. If Delta neutrality isn’t re-established promptly during a swing, even a brief counter-move in the underlying can erode the accumulated convexity gains due to time decay. Gamma scalping thus becomes a race between capturing convexity and losing value to Theta. The key challenge lies in timing: • Too early: Frequent adjustments reduce overall convexity capture. • Too late: Time decay eats into the gains. • Too slow: As expiration approaches, the range in which sufficient Gamma exists narrows, shrinking the window of opportunity. Despite these challenges, Gamma scalping offers an appealing alternative to traditional directional swing trading, with a more nuanced risk profile. However, it does require experience in managing Theta—especially with short-dated options. ________________________________________ Is Gamma Scalping the Opposite of Time Value Trading? In a way, yes, but not quite. Time value trading involves selling options and Delta hedging them—such as in volatility premium strategies (e.g., selling index strangles). These traders aim to minimize realized volatility and capture the decay of implied volatility. By contrast, Gamma scalping buys options and seeks to maximize realized volatility—through the trader’s own hedging actions. The subtle differences in hedge execution distinguish these two approaches. This contrast—and what it means to minimize or maximize realized volatility in a hedging strategy as well as time value trading itself—will be explored in more depth in Part 4 of the “Options Insights – Trading the Greeks” series. ________________________________________ Coming Up Next: 📘 Part 4: Time Value Trading and Volatility Premium by parsifaltrading
TVC:SPXEducation
by parsifaltrading