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.

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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.