Nvidia continues to assert its AI dominance. Using options to ride out gains while limiting risk
Nvidia (NVDA) continues to redefine the pace of innovation in AI infrastructure just as investors were beginning to debate the durability of the current cycle. While the market has largely absorbed the Blackwell ramp, management has once again moved the goalposts with the unveiling of the Rubin (R100) architecture, reinforcing Nvidia’s position at the center of global AI investment through at least 2027. With demand now expanding beyond hyperscalers to include governments and enterprise AI deployments, Nvidia’s growth appears more resilient than prior cycles. As momentum improves and the stock reclaims key resistance levels, NVDA offers renewed upside potential despite its already substantial run. Trade timing & outlook NVDA recently started a new bullish trend after consolidating for the past 5 months above its $185 resistance level, a zone that had capped multiple rallies in the 2nd half of 2025. The subsequent pullback and consolidation above this level suggest a constructive base for further upside. Breakout & retest: Reclaiming $185 and holding it as support signals renewed institutional accumulation. Relative strength: NVDA continues to outperform the S & P 500, reinforcing leadership within the semiconductor and AI complex. Trend continuation setup: Higher lows and stabilizing momentum indicators point toward a continuation move back toward — and potentially above — prior all-time highs. If the current base resolves higher, the setup supports a move toward the $220–$250 range over the coming quarters. Fundamentals: Growth at scale with exceptional profitability Despite its size, Nvidia continues to grow at a pace that far exceeds industry norms while maintaining best-in-class margins: Forward P/E ratio: ~25x vs. Industry Average ~27x Expected EPS growth: ~50% vs. Industry Average ~18% Expected revenue growth: ~48% vs. Industry Average ~12% Net margins: ~53% vs. Industry Average ~14% Nvidia’s growth and profitability suggests the multiple remains substantially discounted relative to peers, particularly given its dominant position across the AI hardware and software stack. Bullish thesis The Rubin architecture: The introduction of Rubin (R100) effectively locks in NVIDIA’s roadmap leadership. Sovereign AI creates new demand: Governments across Europe, Asia, and the Middle East are investing in sovereign AI capabilities, creating a price-insensitive and politically strategic source of demand. Software monetization enhances margin durability: NVIDIA AI Enterprise is emerging as a recurring, high-margin revenue stream layered on top of an expanding installed base. Supply constraints still favor the leader: While concerns around power availability and data center buildouts persist, demand continues to exceed supply. Options trade To express a bullish view while maintaining defined risk, I prefer to buy the Mar 185/220 Call Vertical @ $12.00 Debit: Buy to Open: Mar 185 Call @ $16.35 Sell to Open: Mar 220 Call @ $4.35 Trade characteristics: Maximum Risk: $1,200 (premium paid) if NVDA is below $185 at expiration Maximum Reward: $2,300 if NVDA is at or above $220 at expiration Breakeven @ $197 View this Trade on OptionsPlay for Updated Prices . Summary Nvidia remains the backbone of global AI infrastructure with its technological lead reinforced by the transition from Blackwell to Rubin. While near-term volatility is inevitable given its size and visibility, the combination of improving momentum, expanding demand sources, and sustained margin leadership supports a bullish outlook. For investors seeking exposure to the next leg of the AI supercycle with defined risk, NVDA continues to offer an attractive asymmetric opportunity. DISCLOSURES: Zhang has a position in NVDA. All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
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