Public trading strategy
A 20% overnight gap is a huge one-day repricing, and the article explicitly says
Created
Thesis
A 20% overnight gap is a huge one-day repricing, and the article explicitly says options traders underestimated the move — meaning prices for the stock's insurance are now unusually rich. After such violent gaps, stocks often stabilize and trade sideways as sellers are exhausted, letting elevated option premiums decay in your favor. Selling puts well below the current price lets you get paid for a stabilizing stock you'd be happy to own at a much lower level.
Strategy approach
A 20% overnight gap is a huge one-day repricing, and the article explicitly says options traders underestimated the move — meaning prices for the stock's insurance are now unusually rich. After such violent gaps, stocks often stabilize and trade sideways as sellers are exhausted, letting elevated option premiums decay in your favor. Selling puts well below the current price lets you get paid for a stabilizing stock you'd be happy to own at a much lower level. Decision analysis profile: leveraged. Required dimensions: company_view, instrument_view, contract_identity, event_expiry_timing, implied_volatility_expected_move, theta, breakeven_payoff, maximum_loss, liquidity_spread_volatility, simpler_alternatives.
Markets and timeframes
LULU1D
Latest published rule evaluation
Evaluated . This is a dated rule snapshot, not a live price or trade execution confirmation.
LULU · 1d
0 of 4 published entry conditions marked met.
- SMA (10) above SMA (30) — near
- Price above SMA (10) — far
- ADX (14) below 25 — far
- RSI (14) above 45 — far
Entry and exit at a glance
These are the named rules in the shared configuration. Review the full conditions below before using a strategy.
- Entry: Put-Selling Stabilization Confirmation Short (LULU@1d) (5 conditions)
- Exit: Position Exit Rule (1 condition)
- Exit: Invalidation: Break of Post-Gap Base Low (LULU@1d) (1 condition)
- Exit: Profit Taking: Premium Decay Complete Near Resistance[1] (LULU@1d) (1 condition)
- Exit: Stop Loss at 2.7% (1 condition)
- Exit: Take Profit at 5.4% (1 condition)
Shared strategy rules
Rule configuration
{
"data_dependencies": [
{
"symbol": "STOCK:LULU",
"timeframe": "1d"
}
],
"entry_rules": [
{
"conditions": [
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "sma",
"period": 10
},
"type": "indicator"
},
"operator": "greater_than",
"right": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "sma",
"period": 30
},
"type": "indicator"
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "greater_than",
"right": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "sma",
"period": 10
},
"type": "indicator"
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "greater_than_or_equal",
"right": {
"rank": 1,
"type": "support_level"
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "adx",
"period": 14
},
"type": "indicator"
},
"operator": "less_than",
"right": {
"type": "constant",
"value": 25
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "rsi",
"period": 14
},
"type": "indicator"
},
"operator": "greater_than",
"right": {
"type": "constant",
"value": 45
}
}
],
"direction": "short",
"enabled": true,
"id": "entry_1",
"name": "Put-Selling Stabilization Confirmation Short (LULU@1d)",
"priority": 1,
"trade_symbol": "STOCK:LULU"
}
],
"exit_rules": [
{
"applies_to": "both",
"conditions": [
{
"left": {
"field": "holding_period_bars",
"type": "position"
},
"operator": "greater_than",
"right": {
"type": "constant",
"value": 45
}
}
],
"enabled": true,
"id": "exit_1",
"name": "Position Exit Rule",
"priority": 1,
"purpose": "signal"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "crossed_below",
"right": {
"rank": 1,
"type": "support_level"
}
}
],
"enabled": true,
"id": "exit_2",
"name": "Invalidation: Break of Post-Gap Base Low (LULU@1d)",
"priority": 100,
"purpose": "stop_loss",
"target_symbol": "STOCK:LULU"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "less_than_or_equal",
"right": {
"rank": 1,
"type": "resistance_level"
}
}
],
"enabled": true,
"id": "exit_3",
"name": "Profit Taking: Premium Decay Complete Near Resistance[1] (LULU@1d)",
"priority": 97,
"purpose": "take_profit",
"target_symbol": "STOCK:LULU"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"field": "unrealized_pnl_percent",
"type": "position"
},
"operator": "less_than_or_equal",
"right": {
"type": "constant",
"value": -2.69325
}
}
],
"enabled": true,
"id": "exit_4",
"name": "Stop Loss at 2.7%",
"priority": 100,
"purpose": "stop_loss"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"field": "unrealized_pnl_percent",
"type": "position"
},
"operator": "greater_than_or_equal",
"right": {
"type": "constant",
"value": 5.3865
}
}
],
"enabled": true,
"id": "exit_5",
"name": "Take Profit at 5.4%",
"priority": 100,
"purpose": "take_profit"
}
],
"position_sizing": {
"max_position_percent": 25,
"method": {
"risk_percent": 2.69325,
"support_stop_rank": 1,
"type": "fixed_risk"
},
"min_position_value": 100
},
"trigger_timeframe": "1d",
"version": 2
}Indicator configuration
{
"indicators": [
{
"name": "rsi",
"period": 14
},
{
"name": "sma",
"period": 10
},
{
"name": "adx",
"period": 14
}
]
}Parsed strategy
{
"data_dependencies": [
{
"symbol": "STOCK:LULU",
"timeframe": "1d"
}
],
"entry_rules": [
{
"conditions": [
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "sma",
"period": 10
},
"type": "indicator"
},
"operator": "greater_than",
"right": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "sma",
"period": 30
},
"type": "indicator"
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "greater_than",
"right": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "sma",
"period": 10
},
"type": "indicator"
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "greater_than_or_equal",
"right": {
"rank": 1,
"type": "support_level"
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "adx",
"period": 14
},
"type": "indicator"
},
"operator": "less_than",
"right": {
"type": "constant",
"value": 25
}
},
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"indicator": {
"name": "rsi",
"period": 14
},
"type": "indicator"
},
"operator": "greater_than",
"right": {
"type": "constant",
"value": 45
}
}
],
"direction": "short",
"enabled": true,
"id": "entry_1",
"name": "Put-Selling Stabilization Confirmation Short (LULU@1d)",
"priority": 1,
"trade_symbol": "STOCK:LULU"
}
],
"exit_rules": [
{
"applies_to": "both",
"conditions": [
{
"left": {
"field": "holding_period_bars",
"type": "position"
},
"operator": "greater_than",
"right": {
"type": "constant",
"value": 45
}
}
],
"enabled": true,
"id": "exit_1",
"name": "Position Exit Rule",
"priority": 1,
"purpose": "signal"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "crossed_below",
"right": {
"rank": 1,
"type": "support_level"
}
}
],
"enabled": true,
"id": "exit_2",
"name": "Invalidation: Break of Post-Gap Base Low (LULU@1d)",
"priority": 100,
"purpose": "stop_loss",
"target_symbol": "STOCK:LULU"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"chart_ref": {
"symbol": "STOCK:LULU",
"timeframe": "1d"
},
"field": "close",
"type": "price"
},
"operator": "less_than_or_equal",
"right": {
"rank": 1,
"type": "resistance_level"
}
}
],
"enabled": true,
"id": "exit_3",
"name": "Profit Taking: Premium Decay Complete Near Resistance[1] (LULU@1d)",
"priority": 97,
"purpose": "take_profit",
"target_symbol": "STOCK:LULU"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"field": "unrealized_pnl_percent",
"type": "position"
},
"operator": "less_than_or_equal",
"right": {
"type": "constant",
"value": -2.69325
}
}
],
"enabled": true,
"id": "exit_4",
"name": "Stop Loss at 2.7%",
"priority": 100,
"purpose": "stop_loss"
},
{
"applies_to": "both",
"conditions": [
{
"left": {
"field": "unrealized_pnl_percent",
"type": "position"
},
"operator": "greater_than_or_equal",
"right": {
"type": "constant",
"value": 5.3865
}
}
],
"enabled": true,
"id": "exit_5",
"name": "Take Profit at 5.4%",
"priority": 100,
"purpose": "take_profit"
}
],
"position_sizing": {
"max_position_percent": 25,
"method": {
"risk_percent": 2.69325,
"support_stop_rank": 1,
"type": "fixed_risk"
},
"min_position_value": 100
},
"trigger_timeframe": "1d",
"version": 2
}Strategy instructions
Trading agent generated from recommendation idea 'A 20% overnight gap is a huge one-day repricing, and the article explicitly says options traders underestimated the move — meaning prices for the stock's insurance are now unusually rich. After such violent gaps, stocks often stabilize and trade sideways '. Thesis: A 20% overnight gap is a huge one-day repricing, and the article explicitly says options traders underestimated the move — meaning prices for the stock's insurance are now unusually rich. After such violent gaps, stocks often stabilize and trade sideways as sellers are exhausted, letting elevated option premiums decay in your favor. Selling puts well below the current price lets you get paid for a stabilizing stock you'd be happy to own at a much lower level.
Performance
No trade count, win rate, or realized P&L figures are provided in this public preview. The thesis and shared rules do not establish a performance record.
What this public preview can establish
- The dated rule snapshot above shows the conditions evaluated at that time. It does not prove a current trigger or executed trade.
- Technical strategy fields are shared above. Inspect the actual conditions and check when they were evaluated before relying on them.
- No trade count, win rate, or P&L figure is published in this preview. It cannot establish a performance record.
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