Put Credit Spread Strategy For SPX

Put Credit Spread Strategy for SPX | Thursdays

The SPX options trading research study finds an edge by combining Alpha Crunching's WTR or Weekly Triumph Rate with simple moving averages for trading at the money put credit spreads with 7 days to expiration on Thursdays.

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Alpha Crunching considers each day of the week of having its own characteristics and seasonality. This research takes trades on Thursday afternoon if the following criteria is met.

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Alpha Crunching's WTR or Weekly Triumph Rate is updated each weekend before the trading week begins and shows the historical percentage of times SPX has closed higher 7 days later over the past two months.

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For Thursdays, if the WTR is above 50% then a put credit spread towards Thursday's close is a potential trade candidate.

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For bullish confirmation, SPX needs its 5sma to be above its 10sma on the daily chart about 30m before the close that Thursday before taking this trade. If the 5sma is below the 10sma, the trade is skipped.

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This strategy sells an ATM (at the money) put credit spread with 7DTE (days to expiration) with the goal of receiving at least a $2.00 credit for a 5 point wide spread. This creates a 3:2 risk reward or better for the put credit spread.

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This SPX options strategy held the spread to expiration and ran a 72% win rate from January 2023 through September 2024.

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