Suggested entries
Confirmed mean-reversion setups on the right side of the 20-day median (score ≥ 6). Nothing here means no clean entry today — that's the point.
Δ75–80 long-dated calls that pass Gate A (extrinsic ≤40%) and Gate C (carry ≤8%/yr) and a clear 5-day uptrend.
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Fundamentals
The rules
1 · Structural gates — every CSP & CC must pass all
| Rule | Threshold | Why |
|---|---|---|
| DTE (days to expiry) | 21–45 · target 30 | the monthly cycle |
| Delta | 0.20–0.45 · target 0.30 | ~30Δ sweet spot |
| Premium | ≥ 1.2% of spot | worth selling; ≥1.5% = 🔥 strong |
| Open interest | ≥ 100 | liquidity |
| Bid/ask spread | ≤ 15% of mid | tradeable |
| Earnings | none within 7 days | no gap risk into the print |
2 · Bollinger median — the directional gate
| Strategy | Rule | Meaning |
|---|---|---|
| CSP | %B < 0.5 (below 20-day median) | sell puts into weakness |
| CC | %B ≥ 0.5 (above median) | sell calls into strength |
3 · Entry timing — the mean-reversion setup score
Entry timing = is now a good moment to sell? A turn off an extreme in your favour, with premium richer than the stock's actual moves — not just the right side of the median. Every point below has its own trigger; they add up (max 12) and drive the traffic light in §5 — 🟢 ≥8 strong · 🟡 4–7 analyze · 🔴 <4 too thin.
| Signal | Pts | CC — fade a top | CSP — fade a bottom |
|---|---|---|---|
| A · Stretch price vs the bands (%B) | +3 | %B ≥ 0.90 (through the upper band) | %B ≤ 0.10 (through the lower band) |
| +2 | %B ≥ 0.80 | %B ≤ 0.20 | |
| +1 | %B ≥ 0.70 (upper third) | %B ≤ 0.30 (lower third) | |
| B · Rolling over is the extreme turning? | +2 | 3-day high (%B ≥ 0.95) & down today | 3-day low (%B ≤ 0.05) & up today |
| +1 | turning down from elevated (%B > 0.60) | turning up from depressed (%B < 0.40) | |
| C · RSI exhaustion | +3 | RSI ≥ 70 & turning down | RSI ≤ 30 & turning up |
| +2 | RSI ≥ 63 & turning down | RSI ≤ 37 & turning up | |
| +1 | RSI ≥ 58 (elevated) | RSI ≤ 42 (depressed) | |
| D · Candle | +2 | bearish reversal pattern | bullish reversal pattern |
| +1 | down-day off a higher high | up-day off a lower low | |
| E · Premium edge IV vs realized (HV20) | +2 | IV ≥ 1.25 × HV — rich premium | |
| +1 | IV ≥ 1.00 × HV — fair premium | ||
| Veto | −4 | still walking the upper band (runaway uptrend) | still walking the lower band (breakdown) |
Max 12 = Stretch 3 + Rolling-over 2 + RSI 3 + Candle 2 + Premium 2. Within each block only the highest bracket that applies is counted. The median side (§2) is a hard gate — not scored here.
4 · LEAP — a buy, not premium income
Cost is judged in extrinsic value (the dollars you pay for time), not IV — IV is only the input that inflates it. A LEAP qualifies only if it passes A and C and the trend.
| Element | Rule |
|---|---|
| Delta | 0.75–0.80 (deep ITM = intrinsic-led) |
| DTE | 180–900 · target ~542 (Jan-2027+) |
| Gate A — Time value ≤ 40% | extrinsic (premium − intrinsic) ≤ 40% of premium |
| Gate C — Carry ≤ 8%/yr | carry = (extrinsic ÷ spot) × 365/DTE — the time-value you pay per year, as % of the share price |
| Clear uptrend | price > 50-MA · price > 200-MA · 50-MA > 200-MA |
Entry timing (the mean-reversion setup) is informational only on a LEAP — it is not a gate. A LEAP qualifies on Gate A + Gate C + a clear uptrend; RSI-rising is shown as extra colour, not a pass/fail.
5 · The traffic light — how it all rolls up
Every suggestion carries one colour — a scorecard rollup of the rules above, not a single gate. It's information for your own decision, not a command: amber means analyze.
| Light | CSP / CC | LEAP |
|---|---|---|
| STRONG | every gate passes (§1 + §2) and setup score ≥ 8 (§3) | qualifies (§4) and entry-timing score ≥ 7 |
| ANALYZE | gates pass but the setup is partial (score 4–7) — your call | qualifies, but entry timing is partial — your call |
| WEAK | a gate fails (§1/§2) or no edge yet (score < 4) | fails Gate A, Gate C, or the trend (§4) |
A hard veto — earnings within 7 days, the wrong side of the median, or no liquidity — reads BLOCKED (red) however good the timing. The light never contradicts the scorecard behind it: every gate in a tile's hover is exactly what the colour rolls up. Timing never reds a LEAP (it's informational there).