NVIDIA Corporation (NASDAQ:NVDA) has been red-hot for months. Up 1.4% at $33.59, the stock has rocketed almost 50% higher since early September, and is a chip-shot from last week's seven-year peak of $33.81. In today's options pits, it looks like one speculator's gambling on a run to even higher highs for the visual computing specialist.
Diving right in, data from
Trade-Alert indicates a potential
bull call spread is being initiated at the weekly 1/8 35- and 37-strike calls, for a net debit of $0.46 per spread -- or a total of about $250,000 (net debit * 5,500 contracts * 100 shares per contract), which represents the most he can lose. In so doing, the trader expects NVDA will muscle up to $37 --
territory not charted since late 2007 -- by the close on Friday, Jan. 8, when the weekly series expires.
Option traders have been bullish on NVDA for the past couple weeks. The stock's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX)
call/put volume ratio of 2.70 ranks in the top quartile of its annual range. Likewise, the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.56 rests below all but 13% of comparable readings taken in the previous year.
Looking ahead, NVIDIA Corporation (NASDAQ:NVDA) is scheduled to appear at the Barclays Global Technology Conference tomorrow afternoon. Any positive news could serve as a bullish catalyst for the shares, to the delight of recent call buyers.