U.S. stock futures are aiming for a quiet open after trade war jitters sucker-punched equities yesterday afternoon. The quick return to low volatility should embolden buyers.

Ahead of the bell, futures on the Dow Jones Industrial Average and S&P 500 are flat. Nasdaq Composite futures have lost 0.05%.

My comments on the general levels of options trading have been quite repetitive of late. Chalk it up to the consistency of the slow grind higher and the lack of upside or downside surprises. Yesterday did see a modest rise in put trading alongside the intra-day stock slide. There were about 20.7 million calls traded versus 17.6 million puts.

The return of put demand pushed the CBOE Volatility Index (VIX) single-session equity put/call volume ratio to a one-month high of 0.64. The 10-day moving average continues to hover at its lowest levels of the year at 0.56.

Let’s take a closer look at the hottest stocks on the options board.

Target (TGT)

Yesterday I highlighted the retail ruckus that slammed shares of Home Depot (NYSE:HD) and Kohl’s (NYSE:KSS). Today we’re returning to the sector, but this time it’s good news. Target (NYSE:TGT) shares rocketed 14% higher after topping earnings estimates.

For the fiscal third quarter, the retail leader raked in earnings per share of $1.36 on revenue of $18.7 billion. According to Refinitiv, analysts were forecasting earnings of $1.19 on $18.5 billion. Same-store sales saw impressive growth of 4.5% which topped the expected 3.6%.

The price chart of TGT stock is absolutely stunning. Its gradual 20-year rise morphed into a hockey stick this year. Earnings announcement have fueled the lion’s share of the parabolic rise. All four quarterly reports generated strong up gaps.

If the current gap follows the script of its predecessors, then we should see additional upside into year-end. That said, a pullback or pause to digest the monster gains would help provide a lower-risk entry.

Options trading saw continued buying of calls throughout the session. Total activity grew to the sky and totaled 1,395% of the average daily volume. 64% of the trading came from call options alone.

The size of the jump-and-run exceeded expectations, bringing profits to volatility buyers. Implied volatility deflated to 24% and now sits at the 22nd percentile of its one-year range. Going forward, premiums are baking in daily moves of $1.93 or 1.5%.

Canopy Growth (CGC)

Suffering shareholders in Canopy Growth (NYSE:CGC) received some relief yesterday when the stock popped 15%. The gains are continuing in pre-market trading with CGC up another 8.8% to $19.22.

But you’ll forgive me for the lack of enthusiasm. Rallying some 20% after falling almost 75% means nothing. More on that in a second. The reason for CGC stock’s sudden surge is two-fold. First, a Bank of America (NYSE:BAC) analyst upgraded the stock from “neutral” to “buy.” Second, the stock was so desperately oversold that a snapback was virtually inevitable. This type of bounce has been seen countless times this year when the sellers have pressed their advantage too far.

CGC hasn’t even rallied back to the falling 20-day moving average yet. And it has a heap of overhead resistance. Until we can back above the 50-day moving average and start carving out higher highs and higher lows, I’m skeptical of the rally’s sustainability. You should be too.

The rally lit a fire in the options market, especially in call options. Activity swelled to 360% of the average daily volume, with 189,467 total contracts traded. Calls drove 61% of the tally.

The demand surge pushed implied volatility to 92%, landing it at the 85th percentile of its one-year range. Premiums are pumped and pricing in daily moves of $1.03 or 5.8%. If you’re inclined to play here, I suggest buying spreads over calls or puts outright. It will keep the cost down and mitigate the volatility risk.

Nvidia (NVDA)

One look at Nvidia‘s (NASDAQ:NVDA) stock chart was all I needed before deciding to include it in today’s gallery. It’s pretty. Gorgeous, in fact.

The past quarter’s return to an uptrend placed NVDA back on the radar of momentum traders everywhere, and it’s behavior after last week’s earnings announcement reiterates its strength. I’m particularly impressed by how fast buyers returned after Friday’s drop.

The three weeks of chop have created a classic high base pattern that’s on the cusp of completion. An upside breakout is imminent.

On the options trading front, traders were chasing calls. By day’s end, total activity climbed to 171% of the average daily volume, with 209,353 contracts changing hands. 68% of the sum came from calls alone.

Implied volatility is rallying off of its lowest levels of the year and ended the day at 36% or the 8th percentile of its range. Premiums remain cheap, suggesting bull call spreads offer a compelling path to profits. Consider buying the Jan $220/$230 bull call.

As of this writing, Tyler Craig held bullish positions in NVDA. For a free trial to the best trading community on the planet and Tyler’s current home, click here!