NVDA Bull Put Credit Spread — 2026-08-31

NVDA (NVIDIA Corporation - Common Stock) shows bullish unusual options activity: $1609K of buyer-initiated unusual call flow (100% call-dominant) detected across near-term expirations, with a peak vol/OI ratio of 2442.0x on the 230 call. We fade this by SELLING premium on the other side: the trade profits from time decay as long as NVDA stays above $220 through expiration. IV rank is 23 (low) — rather than sell naked premium at this IV, this is defined as a bull put credit spread (short $220 / long $215) so max loss is capped. Sell the $220 / buy the $215 put bull put credit spread expiring 2026-08-31 (14 DTE) for a net credit of $1.50 ($151 per spread). Breakeven at $218.50; net delta 0.09. NOTE: earnings (2026-08-26) fall inside the trade window — the IV crush after the print helps a premium seller, but the gap risk is real, so this is structured as a defined-risk spread and not a naked short.

Underlying: NVDA @ ~$227.08 | 2026-08-31 (14 DTE) | Net credit (entry): ~$151 per spread. Use limit orders at the mid or slightly better.

ENTRY: Sell the $220 / buy the $215 put credit spread expiring 2026-08-31 (14 DTE) as ONE order at a LIMIT of the mid or better — target credit $151 on a $5 -wide spread. IV rank 23 is low — premium is thin, so keep size small and lean on a defined-risk structure. Don't leg in. Gamma: dealer gamma is POSITIVE (vol-suppressing) — spot tends to pin/mean-revert, so a briefly-tested strike often reverts; don't over-adjust on the first touch; put wall (support) at $220; call wall (resistance) at $230. | TAKE PROFIT: Buy the spread back to LOCK IN gains at ~50% of the $151 max credit (close near $75 remaining). Also close on TIME: exit around 21 DTE regardless of P&L to sidestep the late-cycle gamma/pin risk near NVDA's short strike(s) — currently 14 DTE, so plan the exit 0 day(s) out. Defined risk — max loss $350, so let it run to ~50% rather than scalping tiny. | IF TESTED: If NVDA tests the $220 short put (delta ~0.30) or the loss reaches ~$301 (≈2× credit), roll the WHOLE spread DOWN and OUT ~7–14 days for a net credit — the lone-vertical play is roll-down-and-out or close (there's no untested side to roll in until you add a call spread). Treat a close below the $220 put wall as the hard trigger to act (the pin support has failed). If price knifes past the $215 long put, the spread is at/near max loss ($350) — take it rather than hoping. Breakeven $218.50. EARNINGS: a report (2026-08-26) falls inside this trade — the post-print IV crush helps a seller, but the gap can jump a short strike, so do NOT add size into the event and be ready to take the defined-risk loss if it gaps through. | MAXIMIZE: Winning cleanly above $220? Let theta close it toward 50%. To improve it, roll the spread UP toward the money in the next cycle for a fatter credit once most of this credit is banked, or add a bear call spread above the market to convert into an iron condor and double the premium if the flow turns two-sided.