An overview of institutional covered call rolls for the new week:
$Nvidia (NVDA)$
Sell $NVDA 20241025 142.0 CALL$
Buy $NVDA 20241025 148.0 CALL$
Institutions closed out the $138 and $145 strikes while opening the $142 and $148 calls. The higher strikes signal continued bullish sentiment on Nvidia this week.
However, there are three call strikes with over 100,000 contracts of open interest expiring this week: $142, $148, and $150. Plus $140 still has 71,000 open after last week's rally attempt.
So while a push through $142 seems manageable, capping gains below that strike like last week could prove challenging for dealers.
Selling the $150 calls ($NVDA 20241025 150.0 CALL$ ) seems lower risk on the call side. For puts, $130 looks appealing but the uptrend makes outright put sales less attractive. I'll wait for a pullback.
Additionally, there were scattered buyers of the Nov 29th $110 calls ($NVDA 20241129 110.0 CALL$ ) for around 10,000 contracts total. The ongoing bullish Nvidia flows are becoming numb at this point.
$Tesla (TSLA)$
Sell $TSLA 20241025 232.5 CALL$
Buy $TSLA 20241025 252.5 CALL$
Dealers closed the $225 and $237.5 strikes while opening the $232.5 and $252.5 call strikes - a higher range versus last week, likely due to earnings and Tesla's new "Trump stock" status.
The $200-$240 range still seems fair, so similar trades as before: sell the $200 puts ($TSLA 20241025 200.0 PUT$ ). For a wider call spread, the $250 strike ($TSLA 20241025 250.0 CALL$ ) could cap upside.
$Coinbase Global, Inc. (COIN)$
Sell $COIN 20241025 222.5 CALL$
Buy $COIN 20241025 240.0 CALL$
Coinbase covered calls remain easy to sell short-dated calls on, though $240 is the highest strike to consider for this week.
$MicroStrategy Incorporated (MSTR)$
This one looks messy, but removing the Oct 18th expiry makes it cleaner:
Removing Oct 18th, you can see the dealer opened bullish positions in the $220, $230, $250, and $270 call strikes.
I wish this trader was handling Nvidia instead - with such an aggressive call spread, $150+ on Nvidia this week would be a breeze.
For MSTR, simply selling the highest $270 strike ($MSTR 20241025 270.0 CALL$ ) matches their upside views. The premium looks low but actually translates to over 21% annualized.
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