BY MARK SEBASTIAN
February 27, 2025
Hey Traders,
Welp …
NVDA earnings were not very interesting. The stock is barely moving.
But this is going to lead to some fun movement in the S&P 500 on Thursday.
With NVDA out of the way and the earnings tolerable, I have some expectations for this market I’ll lay out in a minute.
What I will say is that NVDA did what we expected…
On selloff, in the last 49 quarters, NVDA has only moved more than the options were predicting on a sell off 4 times – less than 10%.
On rallies it has moved more than option prices were predicting 16 times … 16!
This was a selloff – a small one, but still a selloff – and it moved less than expected…
So let’s see how this will affect 0DTE Trading.
First, Let’s Recap Yesterday’s Trade
We had a nice, albeit not huge win on Wednesday.
The S&P 500 closed just over 5955, and we were long the 5955-5965-5975 bull zone trade (call butterfly).
With where things closed we made a healthy 58%. Big for a normal trade … not us.
I want to point out when I put out the trade …
… I decided to send the buy where the blue circle is.
It took me a minute to get the trade out, but my timing ended up being almost the exact bottom of the market.
It’s amazing how valuable these bands are.
We could have closed with 10 minutes to go and made more, but the risk was worth it so I held.
…Today’s Outlook
Quite the range on Wednesday! At our peak we were over the 50 DMA, at the lows back below the 100 DMA
In the end …
We closed almost exactly where we started.
Now that NVDA earnings are out – and they were NOT terrible – I am looking for a market wide rally today.
What I will be looking for to set up the trade is a clean break above the 50 DMA … or several candles below the 100.
If either of those happen expect a trade.
If you’re a member, be sure to join Licia at 10:15 ET – she’ll be looking at the charts and can provide her blueprint for market action today.
Call Ted if you aren’t currently a member – 888 872 3301.
Your Only Option,
Mark Sebastian
Mark Sebastian
Founder & CEO, Option Pit
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CAPITOL GAINS: SMR Aug16 7 call closed for a 150% gain
DELTA STRIKE: VLY Mar15 8 puts closed for a 88% gain
PFE May17 26 calls closed for a 66% win
OP MENTORING: SPY Mar22/19 510 put calendars and 520 calls for 6.4% gain
OPTION SHOPPER: ERX Mar28 65 calls closed for a 90% gain