Nvidia options trade targets return to record high

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Nvidia options trade record high

Highlights

Nvidia saw a bullish February call spread trade with over $57 million in premium, targeting a potential rally of nearly 40% to the $245 strike.
The new position replaced a closed $42 million 210/255-strike call spread, shifting to lower strikes for greater upside exposure as volatility remains elevated ahead of earnings.
By midday, 57% of Nvidia options volume was call-side with over $660 million in call premium initiated by buyers, indicating continued strong bullish sentiment in options flow.

Large bullish position reset through February

As reported by CNBC, an options trader placed a bullish call spread on Nvidia worth more than $57 million in premium, making it the biggest single options trade on the tape Monday. The position involved buying 52,000 February 19 195-strike calls while selling the same number of 245-strike calls, reducing the overall cost of the trade by roughly $10 million.

The net structure needs Nvidia shares to trade above around $206 by expiry to turn profitable, implying a gain of about 15% from current levels cited in the report. If the stock reaches the 245-strike short call, that would mark a rally of nearly 40% and bring Nvidia back to its October 6 all-time high of $243.

SpotGamma analysis indicates the trade is likely a roll from an existing 210/255-strike call spread worth about $42 million that was closed out. Brent Kochuba, founder of SpotGamma, says the investor became more aggressive by shifting to lower strikes to gain more upside exposure while volatility remains expensive ahead of earnings.

Options flow points to continued bullish interest

Lower strike calls generally gain value more quickly when the underlying stock rises, giving the trader higher delta exposure and a faster payoff if Nvidia rebounds. That makes the revised structure a higher-conviction bet on a near-term recovery in the stock.

Options activity around Nvidia also leans bullish more broadly by midday, according to SpotGamma data. The data show 57% of options volume is tied to calls, more than $660 million of call premium is likely initiated by call buyers, and 12 of the 20 largest options trades by dollar amount are linked to Nvidia.

The most actively traded single contract by volume is the 180-strike call expiring Monday. That contract requires Nvidia shares to recover 1.2% by the close to break even, underscoring how closely traders are positioning around short-term swings in the stock.

Earlier, we reported that the semiconductor sector index lost about 16% over eight sessions during a broad AI-linked tech sell-off.

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