NVDA Earnings IV Crush Play — Short Iron Condor (Feb 27 Expiry)

Opened this one right before the close today. NVDA reports after the bell tonight and the weeklies are absolutely juiced — figured I’d share the thought process for anyone interested in playing the IV crush on binary events like earnings.

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## The Thesis

NVDA’s Feb 27 weekly options had an IVx of **103.1%** heading into the close. The next weekly out (Mar 2) was sitting at ~71%, and everything further out was in the 53-65% range. That kind of IV differential is the setup — you’re selling premium at 103% IV that’s going to collapse toward 55-65% overnight regardless of which direction the stock moves. The edge isn’t directional, it’s volatility.

## The Trade

**Short Iron Condor — Feb 27 (2 DTE)**

|Leg |Strike |Action |

|--------|----------|------------|

|180 Put |Buy (wing)|Protection |

|185 Put |**Sell** |Short strike|

|210 Call|**Sell** |Short strike|

|215 Call|Buy (wing)|Protection |

**Filled at $1.50 credit.**

- Max Profit: $150

- Max Loss: $350

- POP: 64%

- Breakevens: $183.50 / $211.50

## Strike Selection Reasoning

The ATM straddle was pricing in an expected move of **±$10.58** (~±5.4%). I placed the short strikes outside that expected move:

- **185 put** is ~$12 below current price (~6% OTM) and lines up with the 50/100 DMA support cluster on the daily chart

- **210 call** is ~$13 above current price (~6.6% OTM) and well above the recent trading range

Looking at the last 4 NVDA earnings moves:

|Date |1-Day Move|

|--------|----------|

|Nov 2025|-3.15% |

|Aug 2025|-0.79% |

|May 2025|+3.25% |

|Feb 2025|-8.48% |

Average realized move: **6.46%**. Three of the last four would have landed well within the condor. The Feb 2025 move (-8.48%) would have been the one to worry about — that would have put the stock around $180, breaching the short put. But the trend has been toward smaller moves as NVDA matures as a mega-cap.

## The Plan

This isn’t a hold-to-expiry trade. The whole point is the overnight IV crush. The plan is:

- **Open tomorrow morning, target 50% of max profit** (~$0.75 debit to close)

- If I see green in the first 30-60 minutes, I’m closing and walking away

- Not getting greedy chasing the last 40-50% of premium — once the crush has happened, you’re just holding directional risk for diminishing returns

## Key Takeaways

- The edge is in selling **elevated IV before a known binary event**, not in predicting direction

- Placing short strikes outside the expected move gives you a statistical advantage

- Enter as late as possible before the close to minimise pre-earnings directional exposure

- Take profits early the next morning — the crush is the trade, not expiration

Will update tomorrow with how it played out. 🤞

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*Not financial advice. Just sharing a trade and the reasoning behind it. Manage your own risk.*