NVDA: Last Chance to React!

Sep 4

The NVDA chart presents a clear picture of a pullback to a critical support zone. On the daily chart, we observe that after the sharp drop from the highs around $130, the price has retraced to the 61.8% Fibonacci level, near $108.50. This zone represents a key support area, as the price has bounced slightly from this level. However, the 38.2% and 50% Fibonacci levels around $114.50 and $111.50, respectively, are now the immediate hurdles for any bullish attempt to regain momentum. These levels may act as resistance if the price starts to recover from the current range.

The breach of the 21-day EMA, which had previously acted as support, indicates a weakening short-term structure. The current downtrend aligns with the bearish momentum seen over the last few sessions. For any sustained recovery, NVDA needs to regain control above this moving average.

Shifting to the weekly chart, the price remains within a broader ascending channel, with the recent pullback taking NVDA close to the lower boundary of this channel. This lower boundary, along with the 21-week EMA, provides a confluence of support near the $103 to $108 area. The price action at this level will be crucial, as a failure to hold here could lead to a deeper retracement, potentially targeting the $90 region.

Overall, while the long-term uptrend on the weekly chart remains intact, NVDA faces a test of strength at current levels. The reaction around the 21-week EMA and the lower boundary of the channel will likely dictate the next significant move. If the price can hold these supports, there could be a chance for a recovery back toward the 21-day EMA zone. However, should these supports fail, a more pronounced correction could unfold.

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Remember, real trading is reactive, not predictive, so let's stay focused on the key points described above and only trade when there is confirmation.

“To anticipate the market is to gamble. To be patient and react only when the market gives the signal is to speculate.” — Jesse Lauriston Livermore

All the best,
Nathan.

Sep 12

Note

After materializing a strong bottom signal around the 61.8% Fibonacci retracement, we see NVDA's price take off.

In addition, the price has reacted well above the support line of the ascending channel seen on the weekly chart, as warned in our study above.

Now, we see NVDA's price breaking through our target at the 21-day EMA, which suggests a sharper recovery and a possible reversal of the downtrend.

I'll write a new analysis updating you shortly.