---
title: "Fade the Dip AI"
slug: "fade-the-dip-ai"
description: "Discover the \"Post Earnings: Short Put Spread\" strategy, a custom trading approach designed to capitalize on stock movements after earnings announcements. Learn the open and close conditions, earnings handling, and specific options selections for effective post-earnings trading."
tags: ["Short Put Spread", "Fade the Dip", "SMA", "Today Tab 2.0", "Relative Strength Index (RSI)", "AI", "Skew", "Skewness", "Kurtosis"]
updated: 2026-10-09T20:23:45Z
published: 2026-10-09T20:23:45Z
canonical: "learn.trademachine.com/fade-the-dip-ai"
---

> ## Documentation Index
> Fetch the complete documentation index at: https://learn.trademachine.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Fade the Dip AI

This is a discussion of the "[Fade the Dip AI](https://www.trademachine.com/index.php?share_key=20260914_fIoC3trlAfkcbMqH)" strategy.

Fade the Dip AI Short Put Spread is a neutral-to-bullish strategy that sells a put credit spread when a stock reclaims its 200-day SMA while above its 10-day EMA, with 20-day RSI below 70, one-year skew above 0, one-year kurtosis above 1, and option liquidity of at least 4, exiting when 50% of the credit is captured or two days before earnings—whichever comes first.

### Overview

- Short Put Spread
- 2 legs

### Fade the Dip AI Strategy Settings

#### Fade the Dip AI Open Conditions:

- Stock Crosses Up Through SMA 200 Days
- Stock is above EMA 10 Days
- 20 Day RSI below 70
- 1 year [asymmetry (skew)](/v1/docs/tail-and-skew) of up vs down stock returns above 0
- In the last year, the [kurtosis (tailedness)](/v1/docs/tail-and-skew) of the stock returns has been above 1
- On a scale of 1 to 5 (best) the minimum [liquidity](/v1/docs/liquidity-technical) for an option trade is 4

![Image](https://cdn.document360.io/b73389a5-b202-4bf4-8df2-8c69e8edbb3b/Images/Documentation/image(279).png)

#### Details on Options TradeMachine is Selecting for Fade the Dip AI Strategy:

- 1x **short 50 delta** put near **30 days to expiration**
- 1x **long 40 delta** put near **30 days to expiration**

![Image](https://cdn.document360.io/b73389a5-b202-4bf4-8df2-8c69e8edbb3b/Images/Documentation/image(280).png)

#### Earnings Handling for Fade the Dip AI Strategy:

- [Never Trade Earnings](/v1/docs/earnings-and-trademachine)

#### Fade the Dip AI Close Conditions:

- Close 2 days before earnings
- Gains are above 50%
- Options reach expiration

![Image](https://cdn.document360.io/b73389a5-b202-4bf4-8df2-8c69e8edbb3b/Images/Documentation/image(281).png)

#### Open next trade for Fade the Dip AI:

- [At Normal Time](/v1/docs/what-does-the-and-open-next-trade-at-normal-time-and-re-open-immediately-mean)

![image.png](https://cdn.document360.io/b73389a5-b202-4bf4-8df2-8c69e8edbb3b/Images/Documentation/image%2871%29.png)

## Related

- [Today Tab 2.0](/today-tab-2-0.md)
- [Today Tab 2.0 Strategies](/today-tab-2-0-strategies.md)