Technical Analyst, Saxo Bank
Summary: Nvidia deep dive. Short- medium- and longer term.
A short-term correction could unfold but if Nvidia is staying above 661.60 the uptrend is intact.
Medium- to longer term some indicators suggesting there could still be further 30% upside
Nvidia opened almost 3% higher Friday spiking up to +5% but after just 10 min of trading sellers took control selling through the majority of the trading session so Nvidia closed just 0.35% higher. Traded volume was almost as big as the previous day after Earnings release. That could be a sign of uptrend exhaustion short-term
If Nvidia is experiencing another down day to day and next couple of days a correction could be unfolding.
A daily close below 742,20 could fuel further selling. Possibly down to support at around 661.60
Medium-term on the weekly chart the potential top and reversal pattern described in last week’s update was demolished.
The rising traded volume is supporting the uptrend but there is still some divergence on the RSI suggesting warning about a possible trend exhaustion. On the monthly chart Nvidia reached spot on the 3.00 projection (300%) of the 2022 correction, and overshooting the 1.00 extension of the 2023 bullish trend at 786.83.
If Nvidia keeps climbing it could reach 1.382 Extension at 937.54
Depending on the size of a possible correction it could give it further energy to higher levels IF the share price is not forming a top and reversal pattern in coming weeks and months.
The declining traded volume is a warning sign of weakening of the bullish trend. Declining volume is an illustration of an imbalance BUT that can go on for quite some time as Nvidia seems to be hit with FOMO - Fear Of Missing Out. Another tool based on Point & Figure charting and Fibonacci (yes, it is for the nerds) and on buying and selling thrust i.e., buying push and selling corrections. Developed by David Linton, Updata Analytics. That indicator is pointing to much higher Nvidia levels. The tool is available on that platform only.
As can be seen from the below chart Nvidia has reached all price targets given including the latest one at 779. New target is now at 1,072 i.e., approx. 30% higher. Whether it will be reached remains to be seen.
Please note: This is NOT a recommendation to buy Invidia and it is not a guarantee that this price target will be reached!
And it does not say anything about a potential correction. It is a potential price target tool only
Description of the following Indicators and how I used them - click the link:
Volume
Moving Averages
RSI - and divergence
Ichomokiu Cloud
Technical analysis studies and indicators
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Fixed Income Strategy
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Commodity Strategy
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Fixed Income Strategy
Quarterly Outlook
Head of Commodity Strategy