To The Moon

$NVIDIA (NVDA)$ The TSMC earnings report is crucial, and NVIDIA's stock price trajectory this week largely hinges on TSMC's performance. If TSMC's earnings are favorable, NVIDIA's stock price is likely to close above $850 on Friday. Conversely, if TSMC's earnings disappoint, NVIDIA's stock could slide to around $800. After all, this week's outstanding put options for NVIDIA are heavily concentrated at the lower strike prices of $800, $850, $820, $840, and $830.

As a steadfast bull, I anticipate that TSMC's earnings will boost NVIDIA, allowing it to maintain a level above $850 this week. However, a dip to $800 is also within expectations, potentially triggering a squeeze. A squeeze, similar to GameStop (GME) being driven to $800, refers to a short-covering rally triggered by put options. To mitigate this risk, market makers typically proactively close out their option positions, even at a loss.

The example given is a positive squeeze, while the opposite is a chain reaction triggered by put options. Hence, market makers need to kill options; otherwise, they risk substantial losses.

Although NVIDIA's stock outlook remains uncertain next week, with the possibility of retreating below $880, the good news is that the broader market is likely to rebound, helping to stem this week's downward trend.

$Netflix (NFLX)$ will report earnings after the market closes on Thursday. Option trading has seen a slight uptick, but overall trading interest remains low as most await the earnings results. However, for those looking to position themselves in advance, buying a straddle remains the best choice. This week, someone took a bullish stance, purchasing the $NFLX 20240621 770.0 CALL$ , implying a 25% post-earnings rally. Other bullish options targeting the $700 level include the $NFLX 20240419 720.0 CALL$  and $NFLX 20240419 760.0 CALL$ .

On the bearish side, the focus is on a price range of $520-$530, such as the $NFLX 20240419 530.0 PUT$ , $NFLX 20240419 520.0 PUT$ , and $NFLX 20240510 520.0 PUT$ . This range suggests a 15% decline in Netflix's stock price. Therefore, it is recommended that traders consider buying both calls and puts for hedging purposes.

Regarding Tesla and Apple, the assessment from Tuesday remains unchanged. Selling Tesla puts below $150 and Apple puts at $160 or $155 are considered safe strategies for the next two weeks.