Nvidia stock has finally turned green after 4 consecutive red days. On Monday, the stock of the GPU manufacturer was up 2.24% after opening slightly lower. The bounce comes from a major technical support level which I mentioned in my previous analysis.
US equities in general and tech stocks in particular, have been in a downtrend for the past couple of weeks. After a sharp sell-off in last week, the markets showed a mixed price action on the Monday open. The NASDAQ 100 index was up 14 points while the S&P 500 index lost a couple of points in the initial hours of trading.
Nvidia stock price is facing strong headwinds after the recently proposed restrictions on the export of chips to China. The macroeconomic outlook has added to the bearishness as the investors rush to safety. This factor is evident from the strong rebound in the gold and silver prices last week.
The 10-year treasury bond yield surged to its highest level since 2007 on the first trading day of the week. However, the yield had a pullback once the New York session started. At press time, it was down 0.39% after a 1.48% drop on Friday.
The market participants are also waiting for the FOMC statement which is scheduled to be released next week. Most analysts are betting on the rates to remain the same in the upcoming FOMC meeting.
Nvidia Stock Price Outlook
I have been mentioning the $405 support level on the NVDA chart for quite a while now. The demand around that support level is the primary reason behind today’s bounce. A breach of this support level will be extremely bearish and may result in a trend reversal.
Nvidia stock price prediction is still bullish as the bulls are still defending the $405 support level. Below this support zone, there lies a big price gap that was left after the company’s Q1 earnings report. This zone goes deep till the $306 level and an acceptance between this zone may result in strong selling pressure.
