We recommend selling the following OTM Put Option of NVDA.

Sell NVDA Feb 21 140 PE

Our analysis behind this recommendation is as follows:

A) Analysis of Stock Market Indices

Insight #1: The S&P 500 (SPY) is showing a moderately BULLISH sentiment today! Check the Open Interest distribution for SPY below.

The pie charts illustrate the bullish or bearish sentiment for each ticker {GLD, IWM, QQQ, SPY} by showing the distribution of Open Interest, color-coded as follows:

Insight #2: For SPY options expiring on February 21, 2025 (3 DTE), 76.9% of the total open interest is attributed to “Call Long Buildup” and “Put Writing,” reinforcing a moderate BULLISH sentiment.

B) Analysis of Mag-7 Stocks

Insight #3: NVDA shows the strongest BULLISH sentiment among the Mag 7 stocks, based on the Open Interest distribution across weekly (3 DTE) and monthly (10 DTE) option chains.

Insight #4: NVDA is the most BULLISH based on the weekly (3 DTE) option chains, with 67.4% of total Open Interest attributed to “Call Long Buildup,” 14% to “Put Writing,” and 11.5% to “Call Short Covering.” This distribution signals a strong BULLISH sentiment..

Insight #5: Additionally, NVDA shows strong BULLISH sentiment, as evidenced by the absolute Open Interest distribution across its weekly (3 DTE) and monthly (10 DTE) option chains.

Insight #6: To identify the optimal Strike Price for trading, we analyze the Open Interest at various Strike Prices for NVDA’s Put Options in the weekly (3 DTE) option chain.

Notably, the 140 PE Strike has an Open Interest of 33,398, a Delta of 38.5%, and a Option Premium of 1.81.

Conclusion

Based on our analysis, we propose to Sell to Open the following OTM Put Option of NVDA:

Sell NVDA Feb 21 140 PE

Appendix — My Trade

On February 18, 2025, at 9:56 AM, I executed the following trade:

Sell To Open NVDA Feb 21 140 PE @ 1.81

This trade is clearly reflected in the price chart of the NVDA 140 PE shown below:

I sold to open an NVDA Feb 21 140 Put at $1.81, collecting $181 per contract.

If NVDA stays above $140, the option expires worthless, and I keep the premium.

If NVDA falls below $140, I may be assigned 100 shares at $140, but my effective cost basis is $138.19 ($140 – $1.81).

My breakeven price is $138.19.

This trade reflects a bullish outlook, as I expect NVDA to stay above $140 by expiration.