Nvidia (NVDA) experienced a significant setback last week, with its shares plummeting nearly 9%. This decline comes as investors reassess their positions in leading artificial intelligence (AI) chipmakers, prompted by growing apprehensions over stricter trade regulations and geopolitical uncertainties.
Despite this recent downturn, Nvidia’s stock continues to uphold a long-term upward trajectory. However, trading volumes have tapered off since achieving its peak last month, suggesting a potential deceleration in momentum or a temporary pause in its bullish trend.
Technical Analysis and Key Levels
The 50-day moving average remains robustly positioned above the 200-day moving average, underscoring the stock’s overall bullish sentiment. Nonetheless, analysts caution attention to critical price points amidst heightened market volatility.
Investors are advised to monitor Nvidia’s performance around the $116 mark, a pivotal level where support may consolidate. Should buying interest hold firm at this juncture, it could serve as a springboard for renewed upward movement. Analysts project a potential target near $195, extrapolated from a recent price pattern observed between April and June.
Conversely, a breach below $116 could signal a bearish shift, potentially exposing support levels at $97 and further down to $75. These levels correspond to significant historical points and are likely to attract renewed investor interest, possibly mitigating deeper declines.
Market observers also highlight the importance of monitoring the relative strength index (RSI), which could offer insights into potential oversold conditions. Such indicators, in conjunction with price action at key support levels, may dictate Nvidia’s trajectory in the near term.
As Nvidia navigates these dynamics, stakeholders are advised to maintain a vigilant stance amid evolving market conditions and geopolitical developments impacting AI chipmakers.
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