The volatility-based support and resistance levels allow for a stronger move downwards.

Call and put pricing is predicting a stronger move to the downside.The share price has recently closed above its 20-day moving average.Traders and investors have kept the NVIDIA share price range bound ahead of the earnings announcement.This is possible because options are priced for a move downwards, but unexpected good news could catch traders by surprise and create a swift rise in share price. However, a comparison between the stock’s price action and option activity shows that, if NVDA delivers a positive report, the company’s share price could rise, moving further above its 20-day moving average after the announcement.

It is difficult to accurately predict the direction a stock will move after earnings. Unwinding these bets could create unexpected upward pressure on the share price of NVDA. Trading volumes indicate that traders have been buying puts and selling calls in anticipation of an unfavorable earnings report. The unusual option activity could create a strong upward trend in the price action if NVDA delivers a positive earnings surprise.Ī sizable number of put options remain in the open interest for NVDA, and option premiums are at an unusually elevated level right now. At first glance, it appears option traders are positioned for a negative move, as there are a larger number of put options in the open interest than calls. Investors of NVIDIA Corporation (NVDA) have kept the share prices range bound ahead of the company’s fiscal second quarter earnings announcement.

Nvda options activity