Tony Zhang's NVIDIA Options Strategy


20-Year Pro Trader Reveals His "MoneyLine"

Ditch your indicators and use the "MoneyLine". A simple line tells you when to buy and sell without the guesswork. It’s a line on a chart that’s helped Nic Chahine win 83% of his options buys. Here's how he does it.


On CNBC's "Options Action," Tony Zhang said his bullish stance on NVIDIA Corporation (NASDAQ:NVDA) wasn't particularly good on timing so he is taking one more shot. He said that iShares PHLX Semiconductor ET (NASDAQ:SOXX) had a significant move higher last year, but he has seen a pause since the beginning of the year. Zhang sees this setup as a good continuation pattern.

NVIDIA has been stuck between $500 and $590 for the last nine months, said Zhang. He is starting to see some breakouts on an absolute and relative basis above the $590 resistance level and he likes the setup ahead of the earnings report scheduled for Wednesday.

See also: How to Buy NVIDIA Stock

The options market is implying a move of 6% in either direction on earnings and the stock historically moves around 3.8% on the event. Zhang wants to use a trade structure that accounts for that. He wants to sell the June $600/$580 put spread for a credit of $15.85. The trade is going to be profitable if the stock stays above $584.15 at the June expiration.


20-Year Pro Trader Reveals His "MoneyLine"

Ditch your indicators and use the "MoneyLine". A simple line tells you when to buy and sell without the guesswork. It’s a line on a chart that’s helped Nic Chahine win 83% of his options buys. Here's how he does it.


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Posted In: OptionsMarketsMediaTrading IdeasCNBCOptions ActionTony Zhang