SPX Opening Range Trade: $195 + $595 Bonus in One Signal – The Butterfly Leg Rides Again

The 6 July trade was one of those setups I almost missed entirely. I’d genuinely convinced myself the markets were shut for an extra-long 4th of July weekend. They weren’t. And when the Premium Popper push notification hit my phone, I had a bit of a scramble to sort myself out, get to the desk, and pop the trade on.

Here is the whole thing, from the surprise signal to the Butterfly Leg that turned a routine bullish credit spread into a guaranteed profit with a lottery ticket attached.

The Popper Morning I Nearly Missed

A normal Premium Popper morning is a simple thing. Watch the pre-market. Wait for the signal. Pop the trade on. Get back to my day.

On 6 July, my routine was ambushed by my own bad calendar reading. I had genuinely thought the markets were having an extra long weekend for the 4th of July celebrations, and I was properly tucked into the tinkering-around-the-house mode.

Then the push notification came in. Confused, I went to the desktop and lo and behold, the markets were indeed open. Popped the trade on and got back to the tinkering.

So far, so normal.

The Bullish Credit Spread

As usual, a bullish credit spread is used to initiate the trade. That is the standard Premium Popper entry, and there was nothing fancy about it.

For anyone new to the format, a bull put credit spread is a defined-risk bullish position. Sell a put closer to price, buy a further-out put for protection, pocket the difference in premium. As long as SPX stays above your short strike into expiry, you keep the credit.

Standard. Boring. Effective.

But this one was going to get less boring.

The Butterfly Leg

Here is the twist that makes this trade worth writing up.

As price grinds a little higher and develops a little time decay, I can lock in a profit by turning the credit spread into a butterfly. This might become my favourite way to manage trades. It does require a little more time in trade to manage it this way, compared to the normal in-and-out-at-target approaches. But when it works, it earns its keep.

The mechanic in plain terms. Once the original bull put credit spread has time-decay profit in it, and SPX has stepped higher, I add a second bull put credit spread one strike above the first. The combined position becomes a put butterfly with wings 5 points apart on either side.

Two things happen at once:

• The total credit collected across both spreads becomes the guaranteed profit floor if SPX finishes outside the wings at expiry.
• A lottery ticket for a much larger payout if SPX lands the close inside the profit tent, with the bullseye at the middle strike.

A nice lazy popper and premium popper hybrid again.

The Math

• Wings at 7,525 and 7,535 (5 points either side of the body)
• Body at 7,530 (short strikes)
• $195 locked in anywhere outside the wings at expiry
• $595 maximum at the 7,530 pin
• A profit somewhere between anywhere inside the tent

Guaranteed floor, free upside optionality.

Almost The Pin

Once again, it came a little close to landing in the tent. SPX finished the session at 7,537.43, only a couple of points above the upper wing at 7,535.

Two ticks the other way and we would have been well inside the tent for a decent chunk of the $595.

Such is the way of things.

The floor holds. The $195 is locked. The lottery ticket did not quite land, but it did not cost anything to hold either.

Want To Collect Morning Income Like This?

If you want to collect morning income like this, be sure to check out the Premium Popper system. Same signal that caught me by surprise on 6 July. Same trade management that turned a routine bullish credit spread into $195 locked in with a shot at $595.