Overview
What is a Honey Badger Day
The honey badger signal comes out daily between 6-7pm PST. If you look at the Short Squeeze pane, you want to pay attention to the Honey Badger All and Honey Badger SP500 values. If they’re over 60, then the following day is considered a badgerish day, or a weak honey badger day. If it’s 65 or above, then the following day is a honey badger day. The higher the value, the stronger the honey badger day. A honey badger day applies to SPY.
A honey badger day means that there is a lot of shorting in the market, which means that all of those shorts need to buy to cover, which creates bullish pressure in the market. That bullish pressure tends to present in the latter half of the day.
A successful honey badger day means that we reach either today’s open price or yesterday’s close price, whichever is lower, within the last 2 hours of trading. A honey badger day is typically U-shaped, with early morning weakness, followed by a late day rally.
Let’s take a look at the 5 minute SPY chart on a honey badger day!
We see the typical U-shape here. My usual hold time when trading is anywhere between 5-15 minutes, but on honey badger days, I buy the dips and hold until the late day rally, knowing that there’s bullish pressure coming. I time my entries and exits based on the normal SmartFlow chart signals.
How to trade a Honey Badger Day
I’ll break down how I traded this one!
I saw that Net Option Flow was bearish, we had small bearish Manipulation, and we also gapped up above the previous day’s close price, so I waited to add.
Net Option Flow switched from bearish to bullish, so I scaled into my calls. To learn more about Net Option Flow, check out this article.
We had more bullish Net Option Flow, which gave me confidence to continue to hold.
We were back at the current day’s open price, so I sold most, but held onto a couple runners because Net Option Flow continued to be bullish.
Bullish golden sweep gave me continued confidence to hold.
We were in the last hour of trading, and Net Option Flow switched to bearish, so I sold all for a nice profit.
Key takeaways
Honey badger days are for SPY only.
A fulfilled honey badger days is when we reach either the current day’s open or previous day’s close, whichever is lower, in the last 2 hours of trading.
Honey badger days typically present as early morning weakness and late day rally.