I had a rough day today and could use some advice. I lost $2.2k, which is the most I’ve lost so far. Here’s what happened:
This morning, I bought SPY and QQQ 0DTE options at market open, thinking the market would react favorably since NVDA was up so much. The market didn’t move as expected, and I was already down big. In an attempt to recover, I decided to average down, hoping the market would correct midway through the day. Unfortunately, it didn’t, and I ended up losing even more.
Before today, I was doing well with small, consistent wins, but I guess I got greedy and cocky, turning my trading into more of a gamble. This experience has taught me some hard lessons, and I’m wondering if I should stay away from 0DTE trades altogether.
For those of you who’ve been in a similar situation or have more experience, what would you suggest? Should I avoid 0DTE trades from now on, or is there a better way to manage them to reduce risk? Any advice or strategies would be greatly appreciated.
Thanks in advance for your insights.
Posted by dr7s
20 Comments
Bro. This is gambling. Stop trying to pretend it’s something else.
Besides don’t trade more than you are willing to lose (sounds like $2200 is over your risk tolerance), you don’t have to do anything. Losses are a part of risky speculation. Did you think you’d have nothing but winning days? Long term averages are more important than the results of a single day. If you lose every single day for 6 months straight, that would be a concern. But one loss out of ten sessions, or whatever? Not worth worrying about, unless the loss is more than 10x your average win day.
For comparison, my win rate was around 82% on about 400 trades (none of them 0 DTE, though). But that means I had 72 losing trades. That’s a lot!
If you want to go with 0DTE, you can cap your losses with Stradle (call and put ATM), since you don’t know the direction, you can put some stop loss in both sides, if the market goes into your Call direction (making profit) you can close your put leg, or vice-versa.
Although there will always be some small losses in one leg. In the end this is the way I do this gambling, knowing that I will lose 15% (my stop loss) in one leg to get paid on the other…
Gambling will always be risky.
1. Don’t do 0dte options.
2. Thank you for your donation to the pool of money that props up prices.
3. More money changes hands the closer your strike price is to the market price. That can be money to you or money from you. I think of market price as being the center of a financial vortex. Get close enough so your view of it is worth something but not so close you get caught up in the vortex.
So take less risk and get much further from the market price. If the premium doesn’t make that worth your while do something else with your money. Otherwise your the guy I’m profiting off of.
Days not over. Double down
Damn rip I was wondering how many fools got cooked this morning. I never trade first 30 min it’s too unpredictable on qqq
Just my opinion, but I don’t think there’s any conservative way to play 0DTEs. It’s just not the place to look for small, consistent wins. If I was going to go near them, it would be to make major multiple gains (like 5x) to make up for all the consistent 100% losses. But even then I doubt I’d be profitable over the long run.
I’m not gonna criticize you for your highly speculative trading.
> This morning, I bought SPY and QQQ 0DTE options at market open, thinking the market would react favorably since NVDA was up so much.
Rather gonna hone in on this. How long have you been doing this? Why did you expect the market to react to NVDA? What else were you basing your trades on?
SPY and QQQ have been mostly bullish for 6m, it’s pretty easy to make money on bullish days.
You need to really admit to yourself that you don’t know what you’re doing and have been getting lucky
0DTE I just gambling, plain and simple.
“The market didn’t move as expected” will be on my headstone
I expected QQQ to run today as well but sold out of my position 5 minutes after market open when it didn’t spike like I expected. I definitely didn’t expect the blood letting that is happening today…at all.
Here bro in this case ETFs:
Macro > Earnings > Fundamentals > Technical Analysis
In this case manufacturing PMI came in hot and less unemployment on another report meaning market would tank. If you look at the time the Q tanked it’s exactly when manufacturing PMI came out.
For individual stocks in this case Nvidia:
Earnings > Macro > Fundamentals > Technical Analysis
Even though macro was shit Nvidia still ran up because of earnings so it was in a way ignored the day after earnings.
Memorize this chart to heart and keep an eye out for news when trading. The mistake isn’t that you “were gambling” it’s that you were missing information. Learn from this and get better you got it
the key is to become a good loser, like an insanely good loser, one that can get out and break even on some trades (even if its starts going against you) and losing 10%-15% on the rest. that’s pretty much the only way to stay solvent.
on my 0dte trades i buy very low and sell for a loss the instant they go down in value (i do use charts and indicators to pick a side i dont just pick a side blindly) cheap contracts usually hold their value for awhile, so once the contracts start losing i know i fucked up. on the other hand most of my winners are winners from the get go, they only gain in value the longer i hold. it took me months if not a year to find my comfort zone with 0dte, i still have a long way to go to becoming a great loser but im enjoying it, im learning alot about myself in the process.
0DTE is always risky, but I’ve been successful with the following:
– Never enter in the first two hours and close before the last hour. Try to get the main swing of the day or play the range if necessary
– Wait for a legit trend. Is the market looking bullish, bearish or rangey and play accordingly. If rangey, be careful with your stops and wait for confirmation candles when it reaches the support/resistance threshold
– Set stop losses based on price action rather than monetary value. I.e., if it hits this price, my theory was wrong
– Add to winners, never average down, don’t try to catch a falling knife
The idea is to have a pretty black and white outcome. Either you were right or you were wrong and you should know quickly and have your downside exit automated. I never set take profits because we don’t know how far it’s going to move. I take my profit when the theory is no longer looking correct.
For example, I bought SPY calls this morning at 11:45, realized my theory was wrong and exited at 10:40ish. I didn’t try to push my theory on the market. I realized I was wrong, flipped to puts when it broke support and added to the position as it went down. Ended up big after being down early because I didn’t let my ego convince me my original theory was right
Also, for risk purposes, you can do a 1-3 DTE based on your theory and then a smaller position to the opposite side 5-7 DTE. The latter should have a lower delta and will change slower. If you were right, close the hedge, if you were wrong, close the main position and let the hedge ride
If you’re not ok with randomly losing a few thousand dollars here and there then options trading probably isn’t for you
Damn sorry man sounds like a yolo
My advice… do not trade 0DTE… too much risk!
Focus on strategies in higher timeframes and you will understand how to become profitable! Also, check about income strategies where you win based on options time decay without guessing the market direction. Here are some free resources for all options trading levels: [https://www.myoptionsedge.com/33-blog-articles-every-options-trader-must-read](https://www.myoptionsedge.com/33-blog-articles-every-options-trader-must-read)
If you want a good strategy, check the “SPX Best Options Strategy”.
Today was a crazy day. NVDA +10%, rest of the market -2%. We such unpredictability and high level of intraday volatility, 0dte are even riskier than usual.
In my experience, doubling down when there is a strong intra day momentum is never a good idea…
“Thinking the market would react favorably”. That is the one and only issue. Take “thinking” out of your trading. It’s not possible to out think a market with millions of participants. A favorite saying of sports teams is “take what they give you” and it’s double that for the market. Go into each day with a neutral bias and you’ll be fine.
Learn about a cognitive bias called sunk costs. Also, focus on risk management, emphasize min loss over max gain.