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Option Traders Profit In NVDA
In our TNT option trading service we analyzed NVDA for a potential trade. Our subscribers were able to trade in both directions as the stock moved down above our flat line then traded lower back through the flat line and 50 day Simple Moving Average. Subscribers reported they profited from 20% to 160%. Why the […]
In our TNT option trading service we analyzed NVDA for a potential trade. Our subscribers were able to trade in both directions as the stock moved down above our flat line then traded lower back through the flat line and 50 day Simple Moving Average. Subscribers reported they profited from 20% to 160%. Why the big variation in percentage return? Really comes down to the individual trader and their reaction time.
The original analysis discussed the flat line being close to the 50 day SMA and the powerful move that could come out if the stock started to break out.
On July 10th, during the webinar, the stock opened at $249.75 and proceed to trade down to $248.12. It then rallied back above the flat line and 50 day SMA. In the first hour of the trading day it a rallied to $252.45 and then a high on the day of $254.14.
Traders would have jumped in the July 13th expiration 250 strike calls for about $3.00. They proceed to trade over $5.00 but closed out the day at $4.50. Traders should have realized a 40 -75% return on this leg, depending on when they entered and exited the trade. The next day the stock opened at $249.50 and traded up to $250.90 which was just above the 50 day SMA but quickly failed. At this point the overall NDX started selling off and subscribers jumped in puts using the 50 days SMA as a stop. Subscribers could have jumped into the July 13th 250 strike puts for about $2.00 as the stock was moving back down through the 50 day SMA, The stock proceeded to drop to $247.10 and closed at $247.53. If they exited near the close they could have gotten about $3.50 by hitting the bid. That is $1.50 of profit or 75%. So depending on when traders entered and exited their trade they should have done pretty well. Some subscribers only did one side of the trade and some jumped into puts early on Tuesday and locked in a loss as the stock broke back above the moving average. This reduced the overall profitability of the trade.
In the end it provided a nice return for a couple days of trading!
