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Nvidia stock has jumped 185% so far this year.
The time of dreams
Nvidia
become caught up in a chip war between the United States and China. Only time will tell how far and how long the stock will fall, but data sheets can guide investors through volatility.
The United States could restrict sales of chips needed for artificial intelligence computing to China. Nvidia is the leader in AI chips, so the move could shave billions off its sales in the coming years, no matter how excited investors are about the AI trend.
Nvidia (ticker: NVDA) stock is down 1.3% at $413.48 on Wednesday while the
And
are up 01% and 0.5%, respectively.
That still leaves shares up more than 30% since the company announced explosive results on May 24. AI company is going much better than expected.
However, it is difficult to handicap the result of possible US regulations. Reading stock charts is a little easier.
Founder of Fairlead Strategies and Market Technician Katie Stockton wrote on Wednesday that a “deeper pullback is likely” for Nvidia stock “given the loss of near-term momentum.”
Stockton does not make a fundamental call. It examines how stocks, and all stocks, have traded over time to estimate where investors and traders will enter and exit positions.
Stockton sees ‘spread-based’ equity support near $366, meaning the stock should find investors willing to buy near the level it tracked after Nvidia announced its first quarter results. fiscal quarter on May 24.
The shares had closed at $305.38 that day, before the report was released. The next morning, the stock widened to open at $385.23 and close at $379.80. The May 25 intraday low was $366.35. Investors who missed Nvidia’s first run might consider buying new or adding positions around these prices.
Market and company fundamentals determine a stock’s long-term destination. But fundamentals change, sometimes faster than investors can digest, which makes stock charts a very valuable tool.
At around $409 per share, Nvidia stock is worth over $1 trillion. Anything above about $406 per share keeps the market cap above that high number.
Write to Al Root at allen.root@dowjones.com
