Nvidia shares are on the rise, surpassing the previous closing record of $173.00 set on July 17, and are now trading around $173.10. Earlier this week, the shares fell from $173.17 to $164.58 but bounced back when buyers stepped in near the moving averages. The hourly chart shows a trend where price dips consistently find support at the 50-hour moving average. If that level is breached, the 100-hour moving average also serves as a support line. These moving averages help traders stay optimistic as long as prices remain above them. Traders must recognize when market sentiment shifts. The bullish trend remains as long as prices are above the moving averages. If prices fall below these levels, it would signal a shift toward a bearish outlook in the short term. The analysis emphasizes the need to understand risks rather than just chasing potential profits. Traders should reconsider their positions if support levels fail. For more insights, traders are encouraged to regularly check trading websites for new ideas and analyses. Given the ongoing upward trend, there is a chance to use derivatives to manage risks while benefitting from gains. With the stock soaring over 150% year-to-date, using moving averages as a guide for trades is crucial. This approach helps traders stay in the trend and provides a clear exit signal. Based on the trend of finding support during dips, selling cash-secured puts or put credit spreads is a solid strategy. By setting the short strike price near the 50-hour or 100-hour moving average, traders can collect premiums while clearly defining their risks. This strategy works well if the stock price bounces back, moves sideways, or even drops slightly, as long as it stays above the chosen level. It’s important to watch for the upcoming earnings report expected in late August, as it will likely cause a spike in implied volatility. This makes buying options pricier but creates a good opportunity to sell options. Volatility usually drops right after the earnings announcement. Historically, the stock’s movement after earnings is often less than what the options market predicts, benefiting those who sold the higher premium. The analysis correctly highlights that a drop below the moving averages would indicate a bearish shift. For those trading derivatives, this is a clear sign to exit bullish positions like long calls or short puts. It might also be a good time to start bearish positions, such as buying puts, to take advantage of a potential correction. This bullish sentiment is further supported by strong backing from major institutions. Firms like Rosenblatt Securities have recently raised their price targets to $200 after accounting for the split. This confidence supports staying with the trend as long as the price holds above the discussed technical support levels. As long as we are not overly exposed to risk, there is still a reason to maintain a bullish derivatives strategy.

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