The One Thing to Prioritize for Morning Gaps on SPY

Today marks a pivotal moment in the ongoing U.S.-China trade saga. A 90-day tariff pause—slashing tariffs on Chinese goods from 145% to 30% and U.S. goods from 125% to 10%—has ignited a 3% surge in the SPY this morning, a testament to market optimism amid the trade war. 

As a day trader trading SPY options, I’ve learned that big moves like this demand more than quick reflexes—they require patience, the one thing to prioritize when navigating morning gaps. 

This post reflects on today’s trade, where waiting for price action to reveal its intent shaped my success. 

Whether you’re scalping SPY or refining your system, let’s explore how patience, paired with reaction zones, turns volatility into opportunity.

The Morning Gap: A Test of Patience

A 3% gap up is a double-edged sword—excitement tempts action, but history shows gaps often consolidate or pull back. 

Today’s surge, driven by trade news, could have spiraled into a breakout, a pullback to support, or sideways action. 

I’ve seen spikes fade fast, so assuming a straight drop to yesterday’s levels felt unlikely. 

The key was staying unbiased, letting price action dictate the play. 

This aligns with my philosophy: one solid trade per day, executed with discipline.

The Setup: Reading the Market’s Signals

Pre-market, a reaction zone formed near 580.50 on the 2-minute chart, confirmed by two touches—a setup I eyed for a continuation play. 

I anticipated momentum above VWAP with buyer strength pushing past pre-market highs. But the breakout stalled, lacking the acceleration I needed. 

Instead, price action carved a new intra-day reaction zone near the lows, breaking below VWAP with conviction. 

SPY 2-minute chart 5/12/25

This shift signaled a bearish move, and I entered puts at the green circle, trusting my system over the gap’s hype.

• Entry: The breakdown below the intra-day reaction zone triggered my entry, a moment of clarity amid the morning rush.

• Exit: Hitting my 10% profit target, I adjusted my trailing stop to 5%, locking in gains. A one-hour reaction below the zone hinted at potential resistance, but my trade was done.

This setup, rooted in my 2-minute chart and reaction zone strategy, proved my focus on precision over volume.

Order Fills 5/12/25

The Lesson: Patience as the Ultimate Edge

Today’s trade reinforced a core truth: patience outweighs haste. 

The initial 580.50 zone tempted an early entry, but waiting for the intra-day breakdown saved me from a false move. 

With the market likely consolidating after the gap, patience aligned with price action, yielding a 10% gain. 

As I write, SPY bounced off the one-hour reaction zone, now above VWAP, possibly retesting 580.50. But my 8 a.m. PST window is now closed after one trade—I’m done, content with the outcome.

This patience mirrors my mindset journey. 

Early on, I would often predict breakouts or breakdowns, which would result in the burning of my trading capital.

Journaling those losses taught me to wait —a habit that has turned single trades into consistent wins. 

Why Patience Matters for Morning Gaps

Morning gaps, like today’s trade-war boost, are emotional minefields. 

Greed pushes for quick profits; fear triggers early exits. 

A patient mindset, however, lets you:

• Read Price Action: Wait for confirmation, such as the intra-day reaction zone breakdown, to avoid false breakouts.

• Manage Risk: My 10% risk rule per trade, combined with patience, limits exposure during periods of uncertainty.

• Build Confidence: Sticking to my system, even when gaps tempt deviation, strengthens self-belief.

This approach, honed through reflection, turns volatility into a structured game.

Adapting to 2025’s Market

This year, morning gaps are influenced by rapid news cycles—today’s tariff pause is a prime example. 

I’ve adapted by sticking to my 2-minute chart, filtering noise with reaction zones. 

This system, tested in 2024’s volatility, holds firm, proving adaptability lies in mindset, not just tools.

Conclusion: Patience as Your North Star

The one thing to prioritize for morning gaps on SPY is patience—a mindset that transforms chaos into clarity. 

Today’s 10% gain wasn’t luck; it was the fruit of waiting for the right setup, executing with discipline, and exiting with foresight. 

In 2025’s dynamic markets, this patience, paired with a solid system, is your edge.

It’s not about chasing every move but mastering the art of timing, a lesson etched in my trading evolution.

Action Steps: Cultivate Your Patience

After each session, journal: 

Did I wait for my setup? 

What emotions swayed me? 

Try a 5-minute meditation before the market opens to center yourself; this is a practice I’ve adopted to sharpen my focus. 

Review your SPY trades weekly and adjust reaction zones as needed. 

Patience is a muscle—strengthen it, and your trades will reflect the growth.

Call to Action

What’s your biggest challenge with morning gaps? Share below or follow me on X, let’s refine our edge together!