When volatility, positioning, and directional signals align, swing trades can deliver strong returns with defined risk. Coinbase (COIN) provided a clean example of this, as multiple SpotGamma indicators pointed to a bullish setup with expanding range potential.
Shifts higher in key Gamma levels, combined with rising demand for calls, signaled that traders were positioning for upside. SpotGamma scanners first identified COIN as a candidate, while Equity Hub confirmed a bullish structure with strong call dominance above key levels.
Using this framework, the trade was structured as a bullish risk reversal — capturing upside while managing downside risk — ultimately delivering a 39% return over a two-week swing trade.
Author: Doug Pless
Professional Trader & SpotGamma Content Contributor
| The Setup | The Tools | The Execution | The Payoff |
|
Stock: Coinbase (COIN) Trade Type: Swing trade using options spreads Bias: Bullish continuation with expanding range Volatility: High volatility with wide expected range ($210–$270) Thesis: Rising gamma levels, call dominance, and increasing demand for calls suggested upside potential and a breakout toward higher levels. |
SpotGamma Scanners • Squeeze Scanner identified COIN as a bullish candidate • Highlighted potential for upside expansion Equity Hub + Gamma Levels • Key Gamma Strike: ~$230 • Put Wall: ~$210 • Call Wall: ~$270 • Levels shifted higher → bullish positioning Put/Call Impact Chart • Call dominance above $230 • Indicated upside-driven price action Risk Reversal + Vol Skew • Rising demand for calls (bullish signal) • Elevated IV supported directional move |
Entry: ~$237.50 after pullback to VWAP and reversal higher Strategy: Bullish risk reversal • Sold OTM put spread • Bought OTM call spread Trade Structure: • Short 205 put spread • Long 260–270 call spread Trade Management: • Converted put spread into butterfly as price moved higher • Reduced risk by selling one call spread Duration: May 28 → June 12 (~2 weeks) |
Max Risk: ~$1,960 Max Profit Potential: ~$2,040 Actual Profit: $770 Return: ~39% on risk Result: Structured swing trade capturing upside while actively reducing risk as price moved favorably |
- SpotGamma scanners identified COIN early, flagging it as a high-potential bullish swing candidate.
- Gamma levels and call dominance confirmed upside bias, with positioning shifting higher across key levels.
- The risk reversal structure allowed upside participation with defined risk, while enabling adjustments mid-trade.
- Active trade management reduced risk and locked in gains, resulting in a 39% return over the trade duration.
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