Crazy Opportunity In Big Tech Vol

Yo Pit Crazies,

If you missed it, you can watch Frank Make the Call here.

Here is a call I am going to make, this Nvidia (Ticker: NVDA) earnings cycle will be big. It will set the market tone for the summer.

Mark my words and mark your calendars for after the close on May 24.

If you watch the Market Vector SemiConductor ETF (Ticker: SMH), NVDA has been leading the charge higher as traders moved from Apple (Ticker: AAPL) and Microsoft (Ticker: MSFT) to the semis yesterday.

You see, chips are essential in AI.

Apparently, the AI future is on the back of NVDA now.  A near 200% gain is in the works from the October lows in NVDA and the stock is priced for perfection again.

The funny thing is, the last earnings cycle earnings were just so-so. The market is squeezing into every Big Tech stock it can find for safety. We covered this in our Pro session yesterday.

Let’s trade that …

AAPL Implied Vol Is At Year Lows

Usually, low implied volatility at the top is bullish. Right now, the market desperately wants to get past rate hikes, debt ceilings and inflation. J-Pow is here today to potentially pull a Jackson Hole from 2022 and send the market rolling lower. Or not.

Anyway, like I wrote yesterday, this is not a balanced rally in stocks, with just the top-7 producing most of the gains in the SPX and Invesco QQQ Trust (Ticker: QQQ) trust.

Here is the crazy thing, they can all go higher.  Tech does this time and again with the unlimited promise of future technology.

A lot of money is in money market funds and at some point folks will see QQQ up 25% this year and pile in. 

That means option premium, especially long strangles, make a great play with IV low. 

I like AAPL strangles and VIX puts in the June cycle to ride whatever wave NVDA brings.  NVDA option prices are pumped from earnings.

The J-Powe speech today is just a kicker.

The Rundown

Power Income Trader

SPX two  May 17 4170/4175 call vertical spreads closed for a 100% return on credit

Big Money Flow

Palantir Technologies Inc (Ticker: PLTR) June 16 10 calls closed for a 50% gain.

Trading Desk

VIX, S&P 500 mini index (Ticker: XSP) Apr21/May17 413/418 strangle, 18 puts, 21/30 call vertical spread closed for a 19% gain.

To Your Trading Success,

AG