0DTE Strategy Radar: High-Probability Intraday Playbook

0DTE options are the casino floor of trading—but the house edge works for you if you understand the mechanics.

When an option has literally hours or minutes until expiration, the game fundamentally changes. Time decay accelerates exponentially. Volatility compresses. And most importantly: the probability math that governed 30-day options becomes irrelevant.

This guide builds your mechanical playbook for 0DTE trading using Days to Expiry as your strategic radar. You'll learn which setups to hunt, which setups to avoid, and the capital management rules that separate scalpers from blowouts.

Warning: 0DTE is not for everyone. Capital discipline is non-negotiable. If you cannot follow mechanical rules without emotion, skip this guide and return to 30-45 day puts.

Why 0DTE Is Different (The Physics)

Standard options lose value gradually as expiration approaches. A 30-DTE option loses ~3-5% per day due to theta decay. A 1-DTE option loses ~15-25% per day.

A 0-DTE option (less than 24 hours) loses value in minutes.

Theta Explosion

An SPY call with a $1.00 price at market close loses $0.30-0.50 in the first hour of the next trading day—even if SPY price is unchanged. That's not exaggeration; it's physics. You're watching money decay in real-time.

For put sellers: This is your ally. A put you sell at 10am on expiration day loses 50%+ of its value by 2pm if the underlying doesn't move.

For call/put buyers: This is your enemy. You're buying into the final seconds of the movie.

Volatility Crush

IV (implied volatility) doesn't stay constant as expiration approaches. In fact, IV typically compresses into the final hours. A 40% IV call at market close might be 25% IV at 3pm on expiration day.

Lower IV means lower option prices, independent of the underlying price movement.

Gamma Acceleration

Gamma (the rate of delta change) explodes on 0-DTE options. A 1% move in the underlying stock can swing your option's delta from 0.30 to 0.70 in minutes.

This creates opportunity and danger. A small underlying move can double your profit or wipe out your edge.

The 0DTE Categories: What You're Actually Trading

0DTE breaks into three distinct market conditions:

1. Neutral to Slightly Bullish (Morning)

Market state: After opening bell, implied vol is still elevated from overnight risk. The underlying hasn't made a clear directional commitment.

Your edge: Sell out-of-the-money (OTM) puts or calls. They've still got 3-5% of their value from overnight. You collect that value and let time work for you through close.

Typical trade:

• Buy SPY $500 call, sell SPY $505 call (vertical call spread)
• Collect $0.15 credit (small, but 0-DTE)
• Risk $4.85 (the width minus your credit)
• Probability of profit: 80-85%
• Hold to expiration or close at 50% max profit

2. Event-Driven (Earnings, Economic Data, Fed Minutes)

Market state: Before a major catalyst, IV is inflated. After the catalyst, IV crashes.

Your edge: Sell vol. Sell straddles (short call + short put at same strike). Collect the inflated IV, let it crash into close.

Typical trade:

• Sell 500-strike call, sell 500-strike put (expiring today)
• Collect $0.80 total credit (IV is inflated)
• Risk $9.20 (the width between strikes)
• Probability of profit: ~50% (binary event)
• Profit if SPY closes between $490-510 (the strike-width range)

3. Directional Move (Post-Catalyst)

Market state: Market moved 1-2% in one direction. Now it's testing support/resistance. Scalp the bounce.

Your edge: Buy near-support, sell calls against the rally. Capture the intraday mean-reversion bounce.

Typical trade:

• SPY drops 1.5%, bouncing off 50-day MA
• Buy $500 call, sell $502 call (call spread)
• 3% of stock is in your strikes
• Collect $0.30, risk $1.70
• Probability: 65-70%
• Hold 1-3 hours, close at 50% max profit

The High-Probability Setups: Your Radar

Using Days to Expiry data and historical price action, here are the setups that generate repeatable 0DTE profits:

Setup 1: Expiration Day Iron Condor (Pre-Market)

Conditions:

• No major economic data, Fed speakers, or earnings scheduled
• VIX between 12-20 (not too complacent, not too scary)
• Underlying stock has been consolidating (trading range is narrow)
• Price is between 20-day and 50-day moving average

Execution:

1. Sell 1 call at 0.5-1% above current price (short call)
2. Buy 1 call at 1-1.5% above your short call (protection)
3. Sell 1 put at 0.5-1% below current price (short put)
4. Buy 1 put at 1-1.5% below your short put (protection)
5. Collect 40-60% of the max width as credit (e.g., collect $0.40 on a $1.00 width)

Probability: 70-80% (both sides expire worthless)

Capital: $1,000 per contract (the wing width is your max loss)

Hold time: 30 minutes to 2 hours. Close at 50% max profit, don't hold into close. Gamma risk accelerates.

Setup 2: ATM Straddle Sell (Post-Catalyst)

Conditions:

• FOMC decision, earnings, unemployment report announced
• Market is slightly directional (up or down 0.5-1%)
• IV crushes (vol contracted 30%+ from pre-event)

Execution:

1. Identify the strike where highest volume is (usually ATM or slightly ITM)
2. Sell 1 call at that strike
3. Sell 1 put at that strike
4. Collect the total debit
5. Set max loss at 2x your credit (the theoretical loss if market moves hard)

Probability: 55-70% (depends on how directional the market got)

Capital: 2x your credit (the max risk on a straddle)

Hold time: 1-4 hours post-catalyst. Don't hold past 2pm on expiration—gamma increases and a sudden move can whipsaw you.

Setup 3: Vertical Spread on Support/Resistance (Hourly)

Conditions:

• Stock is at a known support or resistance level (50-day MA, 200-day MA, previous month's close)
• Price has just bounced off it or tested it once
• Volume is normal or above average (not illiquid)

Execution:

1. If at support, buy call spread (buy lower strike, sell higher strike) to play bounce
2. If at resistance, buy put spread (buy lower strike, sell higher strike) to play rejection
3. Use 0.5-1% width between strikes
4. Collect 20-40% of width as debit (you're buying the spread, not selling)
5. Max profit is 60-70% of width

Probability: 65-75%

Capital: Your debit cost (e.g., $0.30 to set up, max profit $0.70)

Hold time: 30 minutes to 2 hours. Scalp the bounce and exit.

The Traps (What to Avoid)

Trap 1: Holding Into Close

Gamma risk is exponential in the final 30 minutes. A $0.50 option becomes $0.05 in 10 minutes if the underlying doesn't move.

But if the underlying does move 1%, that $0.50 becomes $1.50.

Never hold 0DTE positions into the final 30 minutes unless you're 100% certain of the direction. The risk/reward is inverted.

Rule: Close 50% of max profit by 2pm, 100% by 3pm (last hour is too risky).

Trap 2: Trading 0DTE on Illiquid Underlyings

Bid-ask spreads on illiquid 0DTE options are awful. You might sell a call at $0.50, but the market maker bid is $0.10 when you want to close.

Only trade 0DTE on:

• SPY, QQQ, IWM (the ETF trinity)
• Mega-cap tech (AAPL, MSFT, NVDA)
• Highly liquid stocks (AMD, TSLA, etc.)

If you can't get fills within 1 tick, don't trade it.

Trap 3: Over-Leveraging

0DTE amplifies moves. A 1% position can become a 5-10% position in minutes due to gamma. If you size your positions assuming normal leverage, a 0DTE day can wipe your month's gains in hours.

Rule: Size 0DTE positions as 20-30% of what you'd normally risk on a 30-DTE trade. So if you'd normally risk $500, risk $100-150 on 0DTE.

Trap 4: Ignoring the Bid-Ask Spreads

On 0DTE, the bid-ask spread is your biggest enemy. You might think you're selling at $0.50, but if you need to exit and the market is $0.40/$0.60, you're taking losses.

Always check: Bid-ask must be $0.05 or less. If it's $0.10+, the trade isn't worth the slippage.

Trap 5: Trading Around Economic Data You Don't Understand

FOMC decisions, unemployment reports, and central bank speeches move markets. If you don't have a thesis for why the market will move, don't trade it.

Straddles around data are "coin flips with good odds." They're not edge-based trading.

The Mechanical Playbook: Three Setups Per Day

Here's a simple, repeatable framework:

9:35am - 10:30am: Iron Condor

Market opens with typical morning volatility. Consolidation is likely in the first hour.

Setup: Sell 1 iron condor at ±0.75% from current price. Collect $0.40-0.60 credit.

Exit: 50% max profit (collect $0.20-0.30) or 2pm, whichever is first.

Win rate: ~75%

11:00am - 1:00pm: Mean-Reversion Vertical

Market has made a directional move from open (usually 0.5-1.5%). Now it's consolidating or bouncing back.

Setup: Buy vertical spread against the bounce. If market is down, buy call spread. If market is up, buy put spread.

Exit: 50% max profit or 2pm, whichever is first.

Win rate: ~70%

1:30pm - 3:15pm: Directional Bet

Market has a clear bias. Either ride it with vertical spreads or, if uncertain, sell a straddle.

Setup: Based on market direction, buy vertical or sell straddle. If selling straddle, position size is 30-50% smaller than morning positions (gamma risk is exponential).

Exit: 50% max profit OR GET OUT 10 minutes before close. Don't hold options into the bell.

Win rate: 65-75% depending on setup

Sizing and Bankroll Management

0DTE is not scalable in the traditional sense. You can't blow up your account in one day, but you can easily wipe a week of gains.

Three-win rule: If you take 3 consecutive wins, stop trading for the day. You've proven your edge. Ego always shows up after wins—that's when mistakes happen.

Two-loss rule: If you take 2 consecutive losses, stop trading for the day. The market conditions have changed, or you're tired. Both are dangerous.

Max daily loss: Set a daily loss limit. If you hit it, you're done. No revenge trading.

Example bankroll:

• $10,000 account
• Position size: $100-150 per spread
• Max daily loss: $500 (5% of account)
• Win target: 3 wins, then stop

Over 20 trading days:

• 15 winning days (3 wins × $50 avg profit = $150/day)
• 5 losing days (some take the max loss, some don't)
• 15 × $150 = $2,250 wins
• 5 × $200 avg loss = $1,000 losses
• Net: +$1,250/month, or 12.5% monthly return on $10,000

That's realistic for disciplined 0DTE traders. It's not 50% monthly returns. It's not "retire in 3 months." It's steady, mechanical, rule-based income.

The 0DTE Mindset

0DTE traders are scalpers, not investors. You're playing probability and microstructure, not holding convictions.

This mindset shift is critical:

• Your thesis doesn't matter. If SPY rallies 2% into close, your short straddle loses. It doesn't matter if you think the rally is justified. Exit.
• Time decay is your friend. You're always playing the clock. Positions that lose money after 30 minutes should be exited, not averaged down.
• Discipline > Heroics. The traders making 50% monthly returns in chat rooms are posting survivorship bias. The 0DTE traders making 10-15% monthly consistently are the ones following mechanical rules and exiting at target profit.

Start small. Paper trade (simulated) for one week. Execute 3 trades per day using the mechanical playbook. Once you've hit 15+ trades and proven a positive win rate, transition to real money with 10% position sizing.

Days to Expiry makes this process transparent: you can track your entry prices, exit prices, and actual vs. expected outcomes. Use that data to refine your setups. The traders who win at 0DTE are the ones who iterate based on data, not gut feel.

Related Articles

• 0DTE Options: Theta Acceleration & Income Strategies on Expiration Day - Comprehensive guide to expiration day mechanics
• 0DTE Options Strategy: Day of Expiration Income Tactics - Additional 0DTE tactics and strategies
• Theta Decay in Options: DTE Curves, Strategies & Time Value Optimization - Deep dive into theta mechanics
• Options Greeks by DTE: Delta, Gamma, Theta Behavior Across Expiration Phases - Greeks behavior across DTE phases
• Options Greeks Explained: Income Trader's Guide - Greek fundamentals for income traders
• Implied Volatility & Days to Expiry: Timing Your Options Entries - IV and DTE timing for optimal entries