Be prepared for a sharp drop in NVIDIA stock.

١٦ يوليو

There is good reasons to be careful in the stock market going forward for a while, and there are still no trees or shares that have grown all the way up into the sky. Although some stocks are starting to come pretty close now to making it.

Technical Analysis of NVIDIA Corporation (ticker on Nasdaq: NVDA)

NVIDIA Corp. (NVDA) is in a long-term rising trend (cf. weekly chart) and the share is now meeting technical resistance against the upper trend line in this long-term rising trend.

At the same time, various momentum indicators (in the weekly chart) and such as Stochastics, RSI and MACD now signal that the share is likely to face a downward correction in the short and medium term

In the event of a downward correction, there is now little technical support for the share, and a correction can thus be significant.

According to the long-term rising trend, the stock is now right up against the resistance level at the upper trend line of this long-term rising trend.

Yes, according to this long-term upward trend, the overall technical picture for the stock now indicates that it may well get a correction down towards the lower trend line in this upward trend, and down towards USD 35.00 - 50.00 during the next 3- 9 months.

The share is currently trading at around USD 127.00, and it may thus be heading for a sharp downward correction for the NVIDIA share over the next 3-9 months.

This is what the technical picture for the share now signals, and it is, as I said here, a picture that repeats itself among several of the largest IT companies now and for the stock market index Nasdaq Composite, that a major downward correction may be imminent.

It may sound extreme that some of the world's largest companies may see their shares correct sharply downwards and perhaps fall 30-70% within 3-9 months, but also remember that several of these shares have between 5-10 doubled itself during just the past two years.

It is typical for the stock market to 'exaggerate' both on the upside and on the downside, and hence very strong fluctuations on the stock exchange and individual shares.