Options Corner: Nvidia (NVDA)

Core Insights - Nvidia has been an outperformer in the tech sector but is currently underperforming compared to its specific subsector, the semiconductor industry, where the SMH Semiconductor ETF has risen by 44% compared to Nvidia's 31.5% increase [1][2]. Technical Analysis - A downward sloping trend line has been broken, indicating a potential bullish signal as Nvidia has closed above this level [3]. - Key support levels are identified between 165 and 170, while a relative high is noted at 188. The convergence of trend lines and moving averages around the 180 mark suggests a significant area for price action [4]. - The Relative Strength Index (RSI) has also shown a breakout above its trend line and the 50 midline, indicating positive momentum [5]. Trading Strategy - A neutral outlook is suggested for Nvidia, with an expected move of 12% by January 7. An iron condor strategy is proposed, with a maximum profit of 130 and a maximum loss of 370, indicating a defined risk trade [6][7]. - The expected move aligns closely with the identified support and resistance levels, with potential resistance noted between 200 and 205, which is near all-time highs, while support is seen between 165 and 170 [8].