- Nvidia stock price has been sending mixed signals as the United States and China resume their trade rivalry. Where is NVDA likely to head?
Nvidia’s stock price is going into trading today amid a time of technical consolidation after some recent swings. Overall, the market is still positive about the long-term future of the AI infrastructure giant. Demand for its next-generation GPUs is still quite high. However, short-term technical pressure signals that Nvidia (NASDAQ: NVDA) may need to take a break or undergo a small correction before the next big move.
NVDA’s GPUs have been in high demand among AI data centers, propelling the stock’s 34% year-to-date gains. However, today’s gains could be curbed by short-term headwinds caused by overbought conditions and macroeconomic threats. People are leaning toward “buy the dip” opportunities today because the stock is trading at crucial support levels. In addition, TSMC, its key supplier, has just reported good results.
TSMC’s improved sales outlook and strong profits lead to expectations of continued capital spending in datacenters. In other words, this bodes well for the future of Nvidia stock. But if trade tensions between the US and China worsen, Nvidia stock price could go down, possibly testing lower levels before going back up close to November earnings release.
Technical Analysis
Short-term momentum indicators give a mixed to slightly cautious signal. Recently, the stock has been trending downward, falling below its short-term moving averages, which could mean more losses in the near future. As of this writing, the RSI is in a neutral zone, where prices can go up or down without being quickly overbought or oversold. Traders will be very interested in seeing a clear directional signal in the RSI to indicate what they should do next.
There is a strong resistance zone between the $182.00 to $186.00 level. If there is a lot of volume and the price breaks and closes above this zone, it would likely cancel out the recent negative pressure. Also, that could suggest that the price could go back up to challenge recent swing highs.
The key support zone is in the $171.00 to $171.00 range to keep an eye on. This zone has been a basis for recent dips. If the price breaks below this main support level, especially on significant volume, it would be a severe negative sign. It could open the door for a decline into the next structural support level around $170.00.
The bullish outlook is driven by the massive build-out of AI and data center capacity, leading to strong demand for Nvidia’s GPUs.
Strong AI chip demand and TSMC’s positive earnings support NVDA’s dip near $180 as a buying opportunity.
Momentum indicators like RSI and MACD show bullish strength without overbought conditions, suggesting potential for further upside if buying pressure continues.
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