Options Corner: Bracing for NVDA Earnings as SPX Correlation Tightens

Schwab Network lead market technician Rick Ducat analyzed Nvidia's (NVDA) technical setup and options positioning ahead of its upcoming earnings report. Despite gaining roughly 17% over the past year, Nvidia has lagged behind broader semiconductor peers such as Broadcom, AMD, Marvell, and Intel, while exhibiting an exceptionally tight correlation close to 1.0 with the S&P 500. The stock has been trading in a narrow downward-sloping channel after coming off previous highs around $236.54. Key technical levels highlight immediate resistance around $216 and secondary hurdles near $225 and $232, while horizontal support sits near $212, $207, and deeper at $190. The 5-day exponential moving average recently crossed below the 21-day EMA around the $214 level, while the RSI sits slightly below the 50 midline. For traders positioning ahead of the print, the weekly expected move is approximately ±5.9%, while options markets price a ±19.4% swing into the December 18 expiration. An example longer-term bullish call butterfly spread (215/240/255) for a $5.70 debit was proposed to capitalize on potential upside resumption with capped risk.