How I Pick Entries When Selling Options

Rise
May 4
2 min read

Updated: May 6

One of the most common questions I get: how do you actually pick your entry when selling options? Not just what stock, but when to pull the trigger. Here’s my actual process.

The Three Entry Scenarios I Use When Selling Options

Selling into strength (stock is elevated/overbought): I wait for the stock to run up, then sell a CSP below a key support level. The premium is higher because IV is elevated. Example: MSFT ran up to $420. I sold a $400 CSP. Premium was $3.50 ($350 per contract).
Selling into a pullback (stock is at support): The stock dips to a known support level and I sell the CSP right at or just below that support. Example: ASTS pulled back to $20. I sold the $18 CSP — just below support with a cushion. Premium captured: $1.20 per share ($120/contract).
Selling on a spike in IV (volatility event): When the market freaks out or a stock drops suddenly, IV spikes and premiums become juicy. Example: GME had a random spike day. IV jumped from 80% to 150%+. I sold a CSP at a strike I’d be happy owning at. Premium was 3x what I’d normally collect.

My Entry Checklist Before Pulling the Trigger

Would I be happy owning this stock at the strike price? (If no, don’t sell the put)
Is the premium worth it? (I want at least 1% of the strike price per week, or 3-5% per month)
Am I selling below a key support level?
Is there an earnings event within the expiration window? (If yes, factor in the IV crush or avoid)
Does my current portfolio have room for another position? (Max 10% per trade, 20% per stock)

Timing in the Day for Options Selling MATTERS!

I prefer selling options either in the morning (9:45-10:30am ET after the open volatility settles) or in the afternoon (2:30-4pm ET when market makers are managing positions). Midday tends to have lower premiums and wider spreads.

The Bottom Line When Picking Entries

Entry timing matters less than strike selection and stock selection. A great stock with a mediocre entry still beats a bad stock with a perfect entry. Focus on WHERE you’re selling, not just WHEN.