We're going to close our February 1280/1255 bull put spread at a cost of $13.20. We currently have four contracts. So, our debit will be $5,280.
We will roll that into the March 1280/1305 bear call spread for a credit of about $7.80. To replenish the $5,280, we will need to trade 7 contracts. Our credit will be $5,460. That will replenish the $5,280 and give us $180 in spending money.
Our February trade has now become a March trade, but we're patient. Our maintenance, which was $10,000, is now $17,500. Now we get to root for the SPX to continue down.
It's currently at about 1263. Our short call is at 1280. Therefore, we have a cushion of about 17 points.
Take care and trade smart!!