Call Traders Blast These 2 Chip Stocks

Nvidia and Intel weekly calls have been flying off the shelves lately

Managing Editor
Apr 27, 2020 at 2:53 PM
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The 20 stocks listed in the table below have attracted the highest weekly options volume during the past 10 trading days, with data courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. Stocks highlighted in yellow are new to the list. Two names that stick out are Nvidia Corporation (NASDAQ:NVDA) and Intel Corporation (NASDAQ:INTC). Below, we'll take a closer look at the options activity surrounding the two semiconductor stalwarts, and see how they has been performing on the charts amid the coronavirus outbreak.

MAO April 27

At last check, Nvidia stock was eyeing a return the $300 level today, up 3% at $299.43. The 320-day moving average effectively caught the shares' sharp March sell-off, while short-term support is emerging at the 20-day trendline. NVDA is now up an impressive 27.4% year-to-date.

Per White's data, over the past 10 days, 247,965 calls and 150,668 puts have crossed the tape. This afternoon, the weekly 5/1 310-strike call is the most popular, followed by the 305-strike in the same series with positions are being opened at both. Meanwhile, the May 340 call has seen the largest increase in open interest during this time period.

Looking at Intel next, the stock was last seen down 0.5% at $58.74, continuing its recent stretch of sideways trading below $60. The shares have been facing off with their year-to-date breakeven level as well, perhaps underscoring why 14 of the 29 brokerages rate INTC a tepid "hold."

Options players have nevertheless responded by targeting calls, with 205,147 weekly call options and 134,390 weekly put options traded during the past 10 days. Today the weekly 5/1 60-strike call leads the charge, while the June 70 call is home to peak open interest. Plus, INTC's Schaeffer's Volatility Scorecard (SVS) sits high at 97 (out of 100) too, showing that the stock has tended to exceed option traders' volatility expectations during the past year, a good thing for option buyers.

In addition to the heightened options activity, both these chip stocks sport attractively priced premiums at the moment. NVDA and INTC's Schaeffer's Volatility Indexes (SVI) of 50% and 39%, respectively, both sit in the bottom quarter percentile of readings from the past year.


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