Nvidia Corp. - (NVDA) - May 7, 2024
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Benefiting from increased semiconductor demand to support artificial intelligence (AI) development, Nvidia Corp. (NVDA) has consistently been in the Green Favored Zone of the SIA S&P 100 Index Report since January of 2023. Yesterday, NVDA climbed 9 spots to 5th place.
Over the last year, NVDA has returned 221.4%, including a year to date gain of 35.1%. In April, NVDA shares staged a correction but remained in the Green Favored Zone and have bounced back this month. Over the last month NVDA is up 4.71%, outperforming the 0.25% gain made by the S&P 100 Index over the same time period.
Considering how far NVDA* shares have climbed since the start of 2024, it’s interesting to look back and see how the shares spent the second half of last year trading back and forth in a $400-$500 range, particularly since’ it’s unclear if the shares have entered into a new consolidation phase or if they are preparing for a big breakout or breakdown.
Back in March, the shares’ advance stalled short of $975 resistance, with more possible near the $1,000 big round number. From there, the shares started to trend downward, falling back toward $750 before finally finding support.
In recent weeks the shares have bounced back, snapping a downtrend line and regaining their 50-day average and the $900 level. Yesterday’s breakout completed a bullish Ascending Triangle pattern that suggests potential measured resistance near $1,050.
The only technical concern at the moment is that the breakout was not accompanied by a volume spike and that generally the recent rise in the shares has been on falling volumes. If the shares can break out over $975 and then $1,000 it could suggest a new up leg is starting. If the shares falter near or short of those levels it would suggest that the shares may be moving into a sideways range with initial support at the 50-day average near $867.
* Shares of Nvidia are held in portfolios managed by SIA Wealth Management.
Coming off of a big two stage rally to start the year, in April Nvidia* (NVDA) staged its largest correction since January of 2023 (circled), or 10 rows which triggered a bearish double bottom pattern that extended into a low pole.
This month, NVDA has bounced back up off of another higher low, enough to trigger a bullish Low Pole Warning. The shares are now back up above $900 and approaching a retest of their April high.
A close above $953.10 would complete a pending double top pattern and signal the start of a new upleg that could test initial resistance in the $1,000 to $1,030 range which is between a big round number and a vertical count. Should that fail for now, initial support may appear near $846.30 based on a 3-box reversal.
With its bullish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) increasing to 9 out of 10, NVDA is exhibiting short-term strength against the asset classes.
* Shares of Nvidia are held in portfolios managed by SIA Wealth Management.
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