Jim Cramer Discusses Nvidia's Recent 14% Decline and His Investment Strategy
Dec 17, 2024
Smart Money Is Betting Big on NVIDIA (NVDA) Options
Recent activity in the options market shows that wealthy investors are taking a strong bullish stance on NVIDIA (NASDAQ: NVDA). This trend is crucial for market participants to pay attention to. Insights gleaned from public options records reveal a notable development in NVDA options trading today.
According to our analysis, the options scanner has identified 183 remarkable activities concerning NVIDIA. This level of trading activity is certainly unexpected and noteworthy.
The sentiment among these significant investors is somewhat mixed; 45% of them are bullish while 44% are bearish. Detailed inspection shows that there are 72 put options valued at $5,869,285, and 111 call options totaling $7,034,599.
Price Targets for NVIDIA
Based on the observed volume and open interest of these contracts, it seems that large investors are focusing on a price target range from $80 to $180 for NVIDIA over the previous three months.
Understanding Volume & Open Interest
Analyzing both volume and open interest is crucial when engaging in options trading. This data allows traders to assess liquidity and interest regarding NVIDIA options at specific strike prices. Below is a summary of the changes in volume and open interest for call and put options in the last 30 days concerning the significant trades made by larger investors within the $80 to $180 strike price range.
NVIDIA Options Volume & Interest Overview
| Symbol | PUT/CALL | Trade Type | Sentiment | Exp. Date | Ask | Bid | Price | Strike Price | Total Trade Price | Open Interest | Volume |
|---|---|---|---|---|---|---|---|---|---|---|---|
| NVDA | CALL | SWEEP | NEUTRAL | 10/25/24 | $1.79 | $1.78 | $1.78 | $142.00 | $561.4K | 129.3K | 24.6K |
| NVDA | CALL | SWEEP | BULLISH | 10/25/24 | $2.11 | $2.08 | $2.1 | $141.00 | $209.5K | 14.8K | 11.3K |
| NVDA | CALL | SWEEP | BEARISH | 10/25/24 | $1.83 | $1.82 | $1.82 | $142.00 | $173.0K | 129.3K | 28.1K |
| NVDA | CALL | SWEEP | BEARISH | 10/25/24 | $2.82 | $2.79 | $2.8 | $140.00 | $168.4K | 55.8K | 13.2K |
| NVDA | PUT | SWEEP | BULLISH | 11/15/24 | $1.23 | $1.21 | $1.21 | $120.00 | $105.4K | 41.3K | 554 |
About NVIDIA
NVIDIA is a prominent developer of graphics processing units (GPUs). Initially, these GPUs were mainly utilized to improve computer graphics, especially in gaming on PCs. Over time, their applications have evolved, becoming essential components in the field of artificial intelligence (AI). NVIDIA not only provides AI-friendly GPUs but also has a software platform called Cuda, used in developing and training AI models. Furthermore, NVIDIA is enhancing its data center networking solutions to efficiently manage complex workloads reliant on GPU technology.
NVIDIA's Current Market Overview
- The trading volume for the day stands at 7,999,297, with NVDA shares down by -1.25%, currently priced at $141.8.
- Relative Strength Index (RSI) indicators suggest that the stock might be nearing overbought territory.
- The next earnings announcement is anticipated in 27 days.
Analyst Insights on NVIDIA
In the past month, five analysts have issued ratings for NVIDIA, with an average price target of $163.0.
Potential for Strong Profits:
A seasoned options trader with two decades of experience shares a unique chart technique that can identify optimal buying and selling points. By following this strategy, traders have reportedly seen an average profit of 27% every 20 days.
Concerns have been raised, with an analyst from UBS downgrading their rating to Buy, now targeting a price of $150. Similarly, an analyst from Cantor Fitzgerald has lowered their rating to Overweight with a $175 target. In contrast, a Goldman Sachs analyst maintains a Buy rating with a target of $150. A Morgan Stanley analyst also adjusted their rating to Overweight with a $150 target. Notably, an analyst from B of A Securities continues to rate NVIDIA as a Buy, but with a more optimistic price target of $190.
While trading options can involve significant risks, it also presents the chance for substantial rewards. Savvy traders manage these risks through continuous education, strategic adjustments in their trades, and by keeping a pulse on market movements. For ongoing updates on NVIDIA's options activity, utilize real-time alerts and insights from reputable platforms.
NVIDIA, options, investors