Eyes up, traders. It’s about time for Nvidia Corporation (NASDAQ:NVDA) shares to awake from their long summer snooze. And that means profits could be in the offing for those willing to play breakouts in this high-octane stock. The momentum has been building, the volatility has been compressing. And if the recent surge in tech stocks is any indication, NVDA stock is about to get uppity.
![Nvidia Corporation (NVDA) Stock Is Breaking Out](https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif)
A look at the weekly time frame reveals an uptrend for the ages.
Running from $20 to $170 in two years certainly qualifies NVDA as the poster child for hyper-growth stocks. We have seen some slowing in recent months, but what do you expect after such a rocket-like rise? Even the best stocks on the planet deserve the occasional breather.
These consolidation periods are healthy. They allow some shareholders to ring the register while new bulls buy-in. They create support zones to halt future selloffs and provide more stability and longevity to the trend. And, finally, they prevent the stock from overheating and creating parabolic tops and drops.
![NVDA stock chart weekly view](https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif)
Click to Enlarge
So, yes, NVDA has slowed, but I count it as a welcome development. Just look at what happened during its last basing period earlier this year. After catching its breath, NVDA soared anew. Here’s to hoping we get a repeat.
What caught my eye today on the daily chart was the potential breakout over the recent pivot high.
![NVDA stock chart daily view](https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif)
Click to Enlarge
Unlike many other tech stocks that have rallied hard for two days already, Nvidia shares look to be just getting started. And that means we have a lower-risk entry here.
Consider the old resistance at $174 the target for this breakout play.
The Trade on NVDA Stock
To capitalize on the stock’s volatility, let’s do a more aggressive trade — one that could more than double our money. Buy the Oct $170/$175 bull call spread for $2.10. Consider it a bet that the stock will rise above $175 by expiration. If it does, you will capture the max gain of $2.90.
The risk is limited to the initial $2.10 cost and will be lost if the stock remains below $170.
As of this writing, Tyler Craig held bullish positions in NVDA. Want to learn how to master the art of option selling for high-probability cash flow? Check out Tyler’s recently released video series through Tackle Trading on how to systematically sell iron condors for monthly income.