Key Stock Price Levels to Watch Following Nvidia's Admission Into $3T Club

Trending 2 weeks ago

Monitor These Support Levels

Source: TradingView.com.

Key Takeaways

  • Even arsenic AI darling Nvidia joined nan exclusive $3 trillion marketplace capitalization nine connected Wednesday, nan charts bespeak momentum whitethorn beryllium waning for nan stock.
  • Declining trading volumes and a bearish divergence betwixt nan value and RSI parameter connected Nvidia's floor plan signals nan imaginable for a reversal.
  • Key Fibonacci retracement levels wherever Nvidia shares whitethorn find support include: $798, $666, and $535.

Nvidia's (NVDA) marketplace capitalization leapfrogged that of Apple (APPL) connected Wednesday arsenic nan chipmaker joined nan exclusive $3 trillion club. Despite nan awesome milestone, respective floor plan indicators propose momentum whitethorn beryllium waning for nan stock. Below we return a person look astatine nan stock’s important moves complete nan past 19 months utilizing technical analysis and place imaginable support areas during periods of profit-taking.

Since bottoming retired conscionable beneath nan 200-week moving mean (MA) successful October 2022, Nvidia shares person continued to inclination sharply higher, pinch retracements from February past twelvemonth onwards not having capable trading unit to scope nan 50-week MA.

After a singular tally of eleven consecutive greenish play candlestick bars betwixt January and March, nan banal staged a four-week correction of astir 20% done nan first half of April, but quickly resumed its uptrend arsenic buyers snapped up nan dip successful nan lead-up to nan company’s quarterly results past month. 

Following different blowout net report, nan value has continued to climb to caller highs, finishing Wednesday’s convention astatine a grounds close. The banal added 5.2% to decorativeness Wednesday's convention astatine $1,224.40.

Signs of Waning Momentum connected Nvidia’s Chart

Despite Nvidia’s beardown upward trend, declining trading volume accompanying nan astir caller move higher indicates momentum whitethorn beryllium starting to wane up of nan stock’s highly anticipated 10-for-1 split, which takes effect aft Friday’s closing bell.

In addition, though nan banal has made higher highs, nan relative spot parameter (RSI) has made a little high, indicating a bearish divergence, a method arena that warns of a imaginable reversal.

Monitor These Key Fibonacci Levels Amid Profit Taking

We tin place imaginable cardinal retracement levels by applying a Fibonacci grid stretched from nan stock’s October 2022 debased done to Wednesday’s grounds high. 

The first support sits astatine nan 38.2% Fib retracement level astir $798, which besides coincides pinch nan April correction low. The cardinal 50% Fib retracement level marks different imaginable support area situated astir $666, a region connected nan floor plan that sits successful adjacent proximity to nan rising 50-week MA. A deeper pullback would apt find buying liking astatine nan 61.8% Fib level astir $535, an area that aligns intimately pinch apical information of a play of consolidation successful Nvidia shares betwixt July and December past year.

The comments, opinions, and analyses expressed connected Investopedia are for informational purposes only. Read our warranty and liability disclaimer for much info.

As of nan day this article was written, nan writer does not ain immoderate of nan supra securities.

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