Price Forecast:

Bullish Case: NVIDIA's robust AI advancements and upcoming product launches are expected to boost demand significantly, leading to sustainable earnings growth. Positive market sentiment may maintain upward price momentum despite recent volatility.

Bearish Case: NVIDIA faces potential headwinds from increasing competition, regulatory scrutiny, and significant supply chain issues, particularly affecting its AI chip market share. This may lead to downward pressure on stock prices and financial performance.

Potential Outcomes:

• 1. Strong AI demand drives NVDA shares up 25% (40% chance).
• 2. Increased competition leads to a 15% fall (30% chance).
• 3. Regulatory challenges impact revenue by 10%, leading to a 20% fall (20% chance).
• 4. Robust fiscal results maintain prices flat (10% chance).

Trading Oracle: Consider a bullish call debit spread (e.g., buy NVDA $130 call, sell $140 call) for December 2025 expiration, targeting AI momentum with a high probability of profit. This approach limits risk while capitalizing on upside volatility trends. The optimal risk-reward ratio offers substantial alpha.

December 19, 2024