Why I Stopped Trading SPY and Now Make $8,043/day transcript

I traded the S&P 500 for 3 years straight and I was profitable on it. I took over 200 live trades, ended with a 69% win rate, and over six figures in net profit on spy alone. So, when I tell you I avoid trading spy now, it's not because it's bad, it's because I found something better. [music] Today, I'm going to walk you through exactly why I made the switch. What spy was costing me that I didn't realize, [music] and what I trade instead that lets me be done before lunch and more profitable than I was sitting in front of the charts all day.

Before we get into it, let me back up for a second. When I first started trading, [music] my first mentor only traded two things, the S&P 500 and the Nasdaq. He focused on the options and the futures. [music] That was it. No equities, no tech names, no earnings plays. His whole world is trading the index. So, when I was learning from him, I learned how to trade on spy. I learned supply and demands on the S&P 500. [music] I learned how to mark levels of interest.

I learned how to day trade on the S&P 500. That's where I back tested the S&P. That's where I back tested the supply and demand strategy for the first time. That's where I took my first paper trades, and I took my first live trade on spy. It was a call option and it made $20 profit. [music] And for 3 years, that's what I did. I stuck with spy. Every morning, I created my trade plan on S&P 500. At one point, I was starting to build my identity around trading the S&P 500.

[music] And to be clear, I became profitable trading only the S&P 500. And my strategy works perfectly on it. But what I didn't realize back then was how much of my life that ticker was literally taking away from me. Because my average hold time per day trade on spy was about 3 hours, and most days I wasn't even a trade until 10:30 a.m. 11:00 a.m. because spy would mainly consolidate in the first 30 to 60 minutes of market open faking chopping and doing nothing.

So I'd be at my trading desk from before 9:30 a.m. until almost 2:00 3:00 in the afternoon for one trade. [music] Since I learned how to trade on spy, I thought this was completely normal. So I didn't want to deviate from the process that [music] I learned. And once I became a full-time trader in my first and second year of full-time [music] trading, I thought being a full-time trader meant that I had to be glued to my screen all [music] day.

But as time has progressed, I was able to branch out and actually learn a better [music] method. All right, I'm going to show you examples of exactly what I mean. I'm going to pull up some spy examples here, and I'm going to walk you through why it does this because once you see it, you can't unsee it. First, we'll look at a few spy chart examples. So for example, if we're looking at this spy chart, the market opened right here at 9:30 a.m.

From 9:30 a.m. all the way until about 11:30 a.m. spy consolidated. And this is a normal day on spy. On spy early in the day, it's going to be choppy between your levels. So sometimes spy chops or sometimes spy fakes. Sometimes spy likes to retest in the first 30 to 60 minutes before then reversing. So for example, spy tested the demand zone, and price did bounce from the demand zone. It went from this price to this price.

That's my strategy trading from this level to this level. That's exactly what spy did. So even if you enter early in the day at 9:00 a.m., if you held above the zone, it could have been fine. The The part is holding through this. It's is whole hour and a half and what if price doesn't go in your favor? And a lot of traders would stop out somewhere in this area. And what you'll usually see on spy is that the real move usually happens after 10:30 a.m. or after 11:00.

After the first hour of the day, after the fake out traps both sides, then it'll move in the right direction. So, here's another spy chart example. When spy is trading in a consolidation range, it will move slow. So, once again, my strategy is trading from this volume targeting the next level. And price did exactly that. Let's look at another spy example. [music] So, here's another spy chart. From earlier in the day, we had a nice clean trend down.

[music] It looked like it went down from the supply zone down to the demand zone. However, it did have a clean move down. However, when I'm trading the S&P 500, usually I don't jump in on that [music] first 9:30 a.m. to 10:30 a.m. window because on a usual day, there's a lot of consolidation fake outs. [music] So, usually on spy, you won't enter right away. You might miss the first move down. You have to be more patient.

You have to wait for the next move. So, for example, then we tested the demand zone. But it didn't just rally off of its first test. It kind of had a fake break out until it formed a bottom, until it consolidated. And this time period here is representing a whole two hours of consolidation that you have to be patient on. Then price rallies. And this is why a lot of spy traders like to scalp because they are afraid of the pullback.

And these pullbacks are normal on the S&P 500. Price could move from our level, from our demand zone to our next level, to our spy zone. But the move in between could be choppy or it could be more retests of the level. It's less clean. It's less smooth. There's more opportunities to fake out. There's more opportunities to stop out. There's more opportunities to mess [music] up. And here's one more example of the S&P 500 chart.

Once again, earlier today we test the zone. Once again, we go from this level to the next level. But if you're impatient, [music] you'll see from the time it test the zone to the second time it test the zone, it's two whole hours. So if you enter on the first zone test, you might get a stop out anywhere in this area. You might be afraid and exit too soon. So you just have to be more patient for those retests and holding structural levels when you're trading the S&P 500.

So if you're testing your level, you can't expect for it to hit your next level in 30 minutes or 10 minutes or even an hour on the S&P 500. For price to go from the demand zone level all the way to the supply zone level, once again on this example, took all day, 8 hours. [music] And for day traders, that requires a good level of patience. So once again, when price first test the demand zone around 9:00 a.m. to when it goes to the supply zone target, that takes 1 2 3 4, almost four whole hours.

This is typical behavior on the S&P 500 and you have to get used to it when you're trading spy. The reason that the S&P 500 moves this way is [music] because spy is a basket of 500 companies and stocks. It moves like a herd. Trading the S&P 500 demands your patience and your [music] time. And for years I gave it both because I didn't think there was another option. And a lot of traders still flock to trading the S&P 500 because I know I'm not the only person who learned how to trade on it because a huge chunk of the trading community builds their entire trading strategy around trading SPY or the Nasdaq, and it makes sense.

Think about it from their angle. These ETFs, SPY and QQQ, have the deepest liquidity of anything you can trade. [music] They have tight spreads, easy fills. SPY options are some of the most liquid option contracts. So, if you've ever followed an ICT, Inner Circle Trader, they all trade SPY only frameworks. >> [music] >> ICT, entire culture built around trading this one ticker, the index. When you trade the S&P 500 only, you don't have to search for different tickers.

And there is some benefits of trading it because the S&P 500 represents 500 companies. So, if the majority of the market is trending up, you could take calls on the S&P 500, and there's a high likelihood [music] that price will go up. And on the vice versa, if the overall market is in a downtrend, you could take puts on the S&P 500, on the ticker SPY, [music] or for futures on ES. The reason why that works is because [music] if all 500 companies are going down, there's a high likelihood that SPY will also go down.

Tons of traders online trade only SPY. And trading SPY only is a completely valid strategy. Plenty [music] of people make money on it. I made a ton of money on it. But somewhere around year three in [music] my trading career, I started asking a different question. Not just is this [music] profitable, because it was for me. The question I started asking was, "Could I be doing this more efficiently?" What changed my complete day trading lifestyle was discovering equities.

All I did was transfer my same exact supply and demand strategy that I was applying to SPY every day. Same zones, same logic, same execution, but over to an [music] equity ticker. The first tickers that I looked into was Tesla and Nvidia. And the first thing I did before [music] live trading it was back testing my strategy on those tickers. I applied the supply demand zone the same exact way, and I applied my entry model the same exact way using the same confirmation checklist and the same risk management on Tesla [music] and Nvidia.

And what I found is that I could find more day trading opportunities that happen within a shorter window of time from trading these equities. When I went to trading equities, I kept my same supply and demand strategy, trading from zone to zone, trading from level to level. But at what I noticed is when I'm trading equities, these moves tend to happen faster because there's more directional clarity. I could choose an equity that's in a specific trend, choose a strong trending stock, take a trade in that direction, and since I'm being specific in choosing that stock, it tends to hit my target within 60 minutes [music] on average instead of 3 hours or all day.

So, here's one example on Nvidia. It's not like consolidation never happens on equities, >> [music] >> but once we have our consolidation range break, then we tend to have very strong and sustained movements [music] on these equity tickers. So, as you could see here on this Nvidia chart, [music] it was a straight movement from zone to zone, and that whole move happened in about an hour. [music] And here's another example.

This one's on Starbucks. Like we saw, there was a consolidation. It's not that consolidation never happens on equities, but once it goes from zone, it goes to the next zone, especially when we have high volume intraday. But what you can see, we went from our level straight to our next level after the consolidation range break. And once again, this move happened in less [music] than an hour. So, here's another example of an equity ticker.

Very similar setup. The consolidation could still happen on equities, but once we break that consolidation, we have very strong movements, especially from the open earlier in the day. And the whole move, once again, happening within an hour. So, I'm using my same strategy, the same supply and demand zones. I'm still [music] using my same confirmations, but since I'm using trending tickers and market phases out of these consolidation range breaks, [music] I'm able to get eight plus high-quality setups early in the day and be done earlier in the day instead of having to monitor my trade all day.

So, here's one last example of a stock ticker. So, sometimes the stock tickers can move slow. [music] So, as you can see here, this one hit the demand zone early in the day, and it didn't go towards the supply [music] zone until pretty much the end of the day, until an hour before market close. But, the thing that I like about [music] these stock tickers is since they're smooth, trending, there's less pullbacks [music] all the way back to your zone.

So, when I showed you those S&P [music] 500 examples, a lot of the times it came all the way back into the demand zone after the first test, which could [music] which could be really tricky and really emotionally taxing to [music] hold to that trade. So, for example here, after that first demand zone test, it came all the way back twice to [music] the demand zone. But, what I'm noticing on these equity tickers is after it tested the demand zone, it moves far away from the zone, and it [music] gets less close to your stop loss, which helps you be more comfortable to hold through your trade even [music] if it does have to take longer than an hour.

That's when it clicked for me. My strategy was already working great, but the vehicle could be improved. SPY is 500 stocks average [music] together. That's why it consolidates. That's why it fakes. If 250 companies are uptrending and 250 companies are downtrending, we're going to have a consolidated S&P 500. So, by design, you have to wait on S&P 500 before it picks direction. And it's constantly moving 24/7. But, when you're trading an individual trending ticker, you don't have to wait for 499 other tickers [music] to agree and go in the same direction.

If that ticker's uptrending, usually it keeps uptrending very smoothly. When switching from trading only the S&P 500 to begin analyzing and backtesting new and fresh tickers I haven't traded before, I applied the same strategy that I was using before. The supply, the band zones, the trade plans, the confirmation. But, through my back tests [music] and then live trades, I noticed that equities follow their trends much more cleanly.

And if it's outside of a consolidation range, it usually doesn't consolidate as much from the market open. Whereas, the S&P 500 consolidates >> [music] >> all day. And it's a trickier environment to trade it since it is representing the average of 500 companies. So, I didn't change my strategy at all. All I did was change the ticker I was watching, and I noticed [music] I would get my confirmation checklist checking off earlier in the day.

And since I'm able to get an earlier [music] entry without fear that price will consolidate in the morning, I'm able to enter the trade and it hits my stop loss or my target within [music] an hour on these equity tickers. Versus when I was trading the S&P 500, the moves would be much slower towards the target and it would consolidate for two or three hours [music] until it hits my target. So, fast forward to where I am now, since I made the switch in 2024 [music] and locked it in through 2025, I've been done with trading by 12:00 p.m. most days, a little earlier.

And my average hold time went from three hours on spy [music] down to about one hour on average. And the best part is now that I'm more profitable, I've been able to maintain a 70% win rate. And last month, I realized a 1:4 risk-reward ratio. [music] And this is because I'm able to find more opportunities, take more trades, manage my risk better, and not have to hold through a lot of consolidation. I'm picking a trending ticker that opens near my zone, getting in early in the trading day, and being out and done with my trade before noon.

I still trade spy sometimes. I'll take a look at it here and there if multiple tickers are trending in the same direction, but it's not my main plan anymore. It's not where I would spend most of my trading hours because I figured out something that my first mentor never showed me. Is that the strategy is my edge. The ticker is just a canvas where you paint your supply and demand zones. So, if you've been grinding on trading spy every single day, sitting through [music] the chop, wondering why, maybe you are profitable, just exhausted.

This might be why. So, take what you already know and run it on a different chart that actually moves, [music] and you might have better results from applying them. If you want to learn the supply and demand strategy I run on these tickers, [music] and the same one that I used to learn how to trade, and it also works on the S&P 500. I traded it for three years, and I still had a 70% [music] win rate there. That's also everything I teach inside of my private mentorship.

Higher time frame zones, pre-market planning, the whole framework, how to trade spy, how to trade equity options, it's all in there and I work with you one-on-one. If you're interested in applying for the one-on-one mentorship, the link is in the description below. [music] And if you're still learning how to start day trading options as a beginner, I suggest that you watch this video right here. I'll see you in the next video.

Bye.