DailyPlay – Opening Trade (NVDA) – February 26, 2025

NVDA Bullish Opening Trade Signal

Investment Rationale

Technically, NVIDIA Corporation (NVDA) has pulled back to its 200-day moving average level. The stock price has been volatile lately amid news events regarding DeepSeek and, more recently, concerns over potential further tightening of U.S. export rules on the chip sector to restrict China’s advancement in AI. NVDA is set to announce earnings after the close on Wednesday, February 26.  

Fundamentally, NVDA is significantly undervalued. It trades at a premium relative to its peers, but its revenue and EPS growth metrics, along with its profitability, are far superior. Despite its premium valuation, there remains substantial upside potential. NVDA has a forward price-to-earnings ratio of 30.57 times compared to the industry average of 19.76 times. Its expected EPS growth is 64.37 percent, significantly higher than the industry average of 13.67 percent. Expected revenue growth stands at 57.38 percent versus 6.71 percent for the industry, and NVDA’s net margins are 55.69 percent compared to the industry average of 19.87 percent.

NVDA – Daily

Trade Details

Strategy Details

Strategy: Long Call Vertical Spread

Direction: Bullish Debit Spread

Details: Buy to Open 4 Contracts NVDA March 7 $135/$145 Call Vertical Spreads @ $2.45 Debit per Contract.

Total Risk: This trade has a max risk of $980 (4 Contracts x $245) based on a hypothetical $100k portfolio risking 1% for this specific trade. We suggest risking only 1% of the value of your portfolio and divide it by $245 to select the # contracts for your portfolio.

Counter Trend Signal: This is a bullish trade on a stock that is expected to bounce higher based on the coming earnings report.

1M/6M Trends: Bearish/ Mildly Bearish

Relative Strength: 4/10

OptionsPlay Score: 109

Stop Loss: @ $1.23 (50% loss of premium)

View NVDA Trade

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade. 

PLEASE NOTE that these prices are based on Tuesday ‘s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

View NVDA Trade