4 Instruments, 1 Desk Day, And Every Credit Spread Became A Fly

Crude, ETH/BTC twice, RUT and SPX. Four instruments, one day, and by the close every single credit spread had been transformed into a fly.

Thursday was a desk day, which is not normal for me. I don’t normally like sitting at or near the charts all day, but the day was a desk day while I was going through other things, so it was rude not to crack the whip.

Here is what got taken, in order, and the management technique that ties all 4 of them together.

The Setup: A Desk Day

Most of my trading was done before the open and then left alone.

I was at the desk anyway, so I traded like someone who was at the desk. Four instruments, several entries, and a lot more management than I would normally bother with.

That matters, because the technique at the end of this piece is only worth doing when you are actually watching. On a normal day I would have set and forgotten and not try squeeze every last penny out of the moves.

Trade 1: Crude Oil, A Nice Simple Bull Debit Spread

Let’s start the ball rolling with a nice simple bull debit spread on crude oil, based off the analysis completed on Wednesday and executed on Thursday morning.

Classic breakout. Nothing clever. The setup was described the day before, the break happened, and the trade went on.

Traded with a debit spread, in and out for a nice 10c per spread profit.

Filled at 0.10 debit, closed at 0.20 credit. In and out.

That is the entire trade. Called Wednesday, taken Thursday, closed the same session.

Trades 23: ETH/BTC, The One I Have Been Talking About For 10 Days

Two trades here.

The first is the range low to range highs trade that I have been talking about for the last 10 days or so. Wednesday’s news pumped it a little higher and then the breakout move took it even higher.

The target update on Wednesday into Thursday was triggered overnight, and back to cash.

Entry filled at 0.029396. Take profit at 0.032083.

Trade 3: ETH/BTC

The second was a little discretionary. Since you see a pullback after a breakout, and with the speed of the move up, it could be expected to move lower and retest the range highs.

So on the v-entry pattern a bear trade was initiated, looking for that move back to the range highs.

Entry filled at 0.031925. Take profit at 0.030820.

This was reached overnight coming into Friday morning for me, and I’m back to assessing for continuation higher or a break back into the range again.

Trade 4: RUT, Regular Session

RUT was a little late compared to the normal entries I take, and I have neglected trading RUT for a while, so I am looking at it again.

The first breakout happened. Text book. And the community reported banking the premiums on the rally higher, and rested off the range lows.

You can see a clear 2 Day VWAP 1SD retest on the chart. There will be more on these setups in the new updated training coming soon.

It’s the same setup I just mentioned on ETH/BTC, the one I’m waiting for: breakout pullback to the range, with the VWAP kicker.

No pain, and profit exit reached quickly.

Trade 5: SPX, With ES Futures Assistance

This is the one with the most going on.

I commented on the same pattern but on the bull side on Tuesday and Wednesday’s training calls and analysis, so this is a good clear example of the bear setup. Standard patterns can be seen yet again.

The Asian session produced a tight range, which then broke down and out during the UK session. That is your breakout pullback entry, with the height of the pattern being the target.

Of course I have a separate options target, which didn’t quite land. Otherwise the next VWAP entry would have been taken too. Plus I was on a coaching call and not looking.

The eventual speedy drop happened through the target zone and down to the monthly VWAP 1SD band.

With the failure to continue, a bullish trade was taken to push back to the current day’s VWAP. As price pumps higher the target is reached, profits locked. And as I’m paying attention, I adjusted my usual larger optimistic target for what was happening now with price.

A bear position was also taken at the 1 Day VWAP.

And then later a second trade was taken. This would have been a non filled bull breakout on the ORB20, or 1st BO on the cash, but it never went above its trigger bar and moved immediately back in the range.

The ES futures provided a significant layer of detail to what was going on, for me. This is why I keep using ES as the proxy until the out of hours cash data arrives.

After that, it’s a case of waiting for movement and profits to be locked in.

The Twist: The Transformer

Here is the part that ties all 4 instruments together, and it’s the reason this day is worth writing up.

All trades were transformed and profits locked in by transforming the credit spreads into iron flys.

That much is standard for me. Take the credit, and when it moves your way, convert it so the profit is locked and the risk is gone.

But in one case, the wings of those iron flys were transformed back into regular flys.

That’s the bit worth slowing down for. Converting a wing back doesn’t just bank a bit more. It reopens the full potential of that first transformer wing again.

The result is that you are adding to the size and depth of the profit tents rather than just closing the position out. You keep the locked floor, and you get a second run at the upside.

And it makes the profit profile look super interesting.

This is a technique that only works when you are watching, which brings us back to why Thursday being a desk day mattered.

The Math

Crude oil:

• 10c per spread profit, in and out
• Filled at 0.10 debit, closed at 0.20 credit

ETH/BTC, trade 1:

• Entry 0.029396, take profit 0.032083

ETH/BTC, trade 2:

• Entry 0.031925, take profit 0.030820

RUT:

• Popper grade plus 2, 1 lot, Lazy Score 6 out of 6
• Position at expiry showed a $155 floor
• Profit tents at $405 and $655
• RUT finished at 2,995.97, down 36.97 points, or 1.22%

SPX:

• Position at expiry showed a $495 floor
• Profit tents stepping up through $745, $995, $1,250, $1,500 and $2,000
• Sat at $995.80 at expiry with price at 7,653.00
• SPX finished at 7,654.75, down 53.23 points, or 0.69%

The floors are the point again. $495 on SPX and $155 on RUT were locked and could not go backwards. Everything above those numbers was the transformer doing its work.

And The Community Did The Same Thing

The AntiVestor community pulled the premiums. PopPop. Well done yet again team.

RUT was the easy one for almost everybody:

Keith F. “Easy money on RUT this morning. Things lined up. PP for 50% credit received.”

Don E. “me too, closed RUT for 50%”

Bill B. “Yep. Thank you Uncle Russell. 50% Profit. Mr SPX is another story however!”

Scott K. “Bear spread on RUT just below 1st BO, closed for 50%”

RJ M “RUT Popper already hit 50% (and 45%) mark.” Followed by Bill H noting it took 8 minutes, and RJ M replying “Mine was 6 minutes, lol.”

And SPX was another story, exactly as Bill said:

Duncan G. got it right in the premarket: “European morning (US pre market) SPX bear based on ES range break out. Converted to 50c locked in profit with Butterfly. Now sitting at 85c profit as price retraces.”

Chris T. did not: “Messy SPX today. I don’t fancy watching it any longer.” His 1st BO went for -$120, and his own note on it was “Mechanically it looks like a spot on trade that just didn’t work.”

Don E. “Erratic price action took out my stop on SPX, hope it works out for those who are still in the trade (or transformed early into butterfly)”

Chris “Stopped out on BO1 for SPX. Was about to take BO2 when price shot down. Decided best to stay out.”

James D. “Took the SPX Bear LP for a win :-)”

Silas P. summed the day up: “All in all, 2 wins on Rut, 1 loss on Spx. Back at the salt mines tomorrow.”

KBL Destinations Trading LLC closed +$142.28 cumulative on the day.

That spread of results on the same day is worth sitting with. Same system, same signals, and SPX still chewed up several people while RUT paid almost everyone. Chris T.’s note is the honest version of it: a spot on trade that just didn’t work. That happens, and the answer isn’t to change the system.

The difference can be explained as differences in strike selection – premium collected – and/or stop loss decisions – all of which can be customised beyond the default setup I discuss in the training.

Want To Trade The Same Setups?

Everything in this piece came off the same 2 systems.

Collect morning income: the Premium Popper flags the session, grades the setup, and tells you what size it deserves.

Collect weekly income: the SPX Income System runs the swing side.

The transformer technique will be covered in the new updated training coming soon.