Watch These Nvidia Price Levels as Stock Seesaws After Earnings Report
Pre-Earnings Consolidation
Nvidia (NVDA) shares seesawed in extended trading on Wednesday after the AI investor favorite posted better-than-expected quarterly results and issued a strong outlook amid booming demand for its advanced AI chips. The stock’s pre-earnings consolidation phase, which began after forming a bullish engulfing pattern at the 50-period moving average, has now come to an end.
As the company’s next-generation Blackwell chips continue to gain traction, investors should watch key support levels near $130, $113, and $96, while also monitoring crucial overhead areas at $153 and $255.
Key Support Levels to Watch
The first nearby support level to watch sits around $130. This area, just 1% below Wednesday’s closing price, may attract buying interest near a trendline that connects peaks in June, July, and August with a series of comparable price points on the chart between December and February. A breakdown below this important technical level could trigger a fall to the $113 level, where the shares may find support near the low of the bullish engulfing pattern.
Further selling opens the door for a more significant correction down to around $96, about 27% below Wednesday’s close. Such a drop could see investors looking for buying opportunities near the prominent March peak, which closely aligns with the August sell-off trough.
Crucial Overhead Areas to Monitor
A move higher after earnings could see the chipmaker’s shares revisit the crucial $153 level. Tactical traders who have accumulated shares through the recent consolidation phase may look for exit points near the stock’s record high. Investors can predict a longer-term overhead area to monitor by using the bars pattern tool, which forecasts a bullish target of around $255 based on the stock’s trending move from October 2023 to March last year and overlaying it with this month’s low.
Why These Prices Matter
The importance of these price levels lies in the fact that they represent key areas of support and resistance, which can dictate the stock’s trajectory in the short and long term. A breakdown below $130 could trigger a larger correction, while a move above $153 could propel the stock higher towards $255.
The Bottom Line
As Nvidia’s AI-driven business continues to drive growth, investors should keep a close eye on the key support levels and overhead areas we’ve identified. By doing so, they can better navigate the stock’s post-earnings volatility and identify potential buying opportunities or areas to trim positions. Remember, the stock’s trajectory is influenced by a complex array of factors, and it’s essential to stay informed and adapt to changes in the market.
Disclaimer
The comments, opinions, and analyses expressed on this article are for informational purposes only. The author does not own any of the above securities. Read our warranty and liability disclaimer for more information.
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