Quick-Strike Bearish Trades While Broader Markets Are Trending Higher | Long Verticals & Diagonals

Long Verticals & Diagonals | Cameron May | 12-4-25
Characteristics and Risks of Standardized Options. https://bit.ly/2v9tH6D

In this video, Schwab Education Senior Manager Cameron May will explore how traders might plan and place quick-strike bearish trades even when the broader market is strong or trending higher. Using the thinkorswim desktop paperMoney trading platform, we’ll walk through the logic behind identifying short-term bearish opportunities inside an otherwise bullish environment, such as extended rallies, overbought conditions, resistance tests, weakening momentum, or sharp intraday reversals. We’ll focus specifically on the weekly long put vertical spread, a defined-risk strategy that can allow a trader to express a short-term bearish opinion while focusing on controlling position size and risk exposure.

With real-time market examples, we’ll analyze chart setups, option prices, and market conditions to illustrate how and when a trader might consider this type of trade. You’ll see how a trader might select strikes, evaluate risk-reward, balance probability versus potential gain, and place the full order step-by-step on the paperMoney platform. By the end of the video, you’ll have a clearer framework for potentially using long put vertical spreads as a tactical bearish tool, while still recognizing the risks and limitations of trading against a strong market trend.

Some stocks are expensive and even their options are costly! Join your education coach to discover an option strategy that allows you to consider options with those expensive underlying stocks with relative low amounts of capital. Learn the risks and how to trade and manage long vertical and diagonal spreads.
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Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Please read the Options Disclosure Document titled "Characteristics and Risks of Standardized Options" before considering any option transaction.

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Scripts are for educational purposes only, are not a recommendation, and are not guaranteed for time or accuracy.


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