CVNA Put Credit Spread 360/355 – 01/23/26

1. Indicator State: PCS READY = TRUE (84/100 Score)

On the entry candle, my scan shows PCS READY – 84/100, meaning the core structural conditions were still intact even after today’s sharp pullback:

Trend: OK
Close > SMA50: OK (price still above rising 50)
SMA50 > SMA200: OK
RSI (40–65): OK (pulled back into neutral, not breakdown)
ATR% ≥ 1.5: ~4.6% ✅
Gap% < 4: ~0.1% ✅
Above recent swing low (20): OK

This score drop versus the earlier 90s that i saw was to be expected on a fast red day — but the system did not flip bearish.

2. EMA Structure: Trend Bent, Not Broken

Even with the −5% day:

20 EMA (yellow) still above the 50 EMA (orange)
50 EMA is rising, not flattening
Price is pulling back toward EMAs, not losing them

This is an important distinction:

PCS trades don’t require strength — they require structure survival.

Today’s move was a volatility event inside a bullish regime, not a trend failure.

3. Context Matters: Expansion → Pullback → Mean Reversion Zone

Zooming out on the structure:

Strong December upside expansion
Price stretched far above the EMAs
Current move is a mean-reversion pullback, not distribution
No daily close below the 50 EMA at entry

My PCS framework is designed to sell puts during fear spikes that remain above structural support — and that’s exactly what this candle represents.

4. Time + Credit Make Sense Here

Expiration: Jan 23, 2026 (≈ 20–23 DTE at entry)
Credit received: $0.85 on a $5-wide spread
ATR elevated: Paid you more during fear
Shorter DTE = faster theta decay per day

I’m getting paid for short-term uncertainty, not long-term trend risk.

My Personal Thought’s outside the Technicals

So, this is my first trade that I opened that is less than the 30-45 DTE expiration contracts that I normally open. I saw the RSI is below 50 but hasn’t gone below 40 which is a nice area to sell puts from my experience. I figured I might as well try something new today with a shorter DTE so I can avoid volatility swings that might happen on a longer DTE. Honestly this is the first time I’m doing it so I’m a bit cautious on this trade. I went light as its a new idea. Hopefully it works out. Remember I only get into trades during the time when price is below the vwap and at least near the 1 standard deviation from vwap. The price when I entered was around 398. I’ll give it a few days and see where its at. I have a 1 to 1 risk ratio so if premium goes to $1.70 thats my stop loss.

So CVNA Jumped up more than $20 today. My GTC order for 50% hit as well around 7:30 AM with SNDK at the open.