To The Moon

$NVIDIA Corp(NVDA)$ - The Nvidia options market is expected to replay last week's battle, with market makers continuing to pressure both calls and puts. The 900 calls ($NVDA 20240419 900 CALL$ ) and 850/800 puts ($NVDA 20240419 850 PUT$ , $NVDA 20240419 800 PUT$ ) remain the targets to be crushed. So after taking out the 900 calls on Monday, the next 4 days will be a defense of 850. Holding 850 could allow for a minor bounce, but failing to defend it will likely trigger a squeeze down towards 800. The trading mindset remains similar to last week:

Either bet that Nvidia doesn't drop to 800, or bet that it does. For the former, I'm betting Nvidia doesn't break 850 this week or 800 next week, as 825 and 750 are support levels. So for the next two weekly expirations, the put sell strikes to consider are 850, 800, 750 - choose based on risk preference. The opposite view is betting shares slide to 800 over the next two weeks, which presents a few strategies like: buy puts, sell puts, or sell calls. Buying puts means buying the 800 strikes now. Selling puts means waiting for a dip towards 800 to effectively buy the dip. Selling calls involves calls above 950, as objectively 950 is a resistance level, so if 850 is being tested over the next two weeks, selling upside calls makes sense, though ideally hedged with some long call legs.

However, there is another issue this week - the massive open interest for April 19th expiry, especially in $SPY$. This heavy open interest will create a resonance effect where stocks may move in tandem. For $SPY$ put open interest is not a major factor as the closest big strike is the 410 puts, way out-of-the-money. The contracts to be taken out are the call side - the $SPY 20240419 505 CALL$  and 500 CALL$. So $SPY$ is likely to see downside this week.

My choice is to sell the $NVDA 20240426 900 CALL$ . If you don't have a stock position, don't blindly follow me. Without shares, you can spread it by adding a long call leg.

For $Tesla Motors(TSLA)$ , I'm sticking to my view that it doesn't break 150 next week. If it does this week, then selling puts could make sense. But looking beyond next week, Tesla doesn't appear to be a big money favorite for strength this year.

$Apple(AAPL)$ tends to be stable ahead of earnings, just trading in a range. So selling the 160 or 155 puts like the $AAPL 20240426 160 PUT$  could be suitable.