I called the previous peaks of $140 NVDA and $270 TSLA. We’re nearing another peak with NVDA at $130.
$140 $NVIDIA (NVDA.US)$
$270 $Tesla (TSLA.US)$
Above is my post history where I’ve called out several peaks before a sizable sell-off began. I’ve made these calls by following through with technical analysis - combining warning signals from several indicators to greatly improve accuracy of price movements.
Here are some ‘concerning’ signals of the current NVDA price which I believe, is pointing to a highly probable peak.
1. NVDA hard stop at $130 - adhering to the ranges of a falling wedge.
With the recent peaks at $141 on 20 June’24, $136 on 11 July’24 and the very recent $130 from yesterday (20 Aug’24), the price movement of NVDA is forming a widening, falling wedge that if actualised, will see the price movement head down to the EMA 200 and bottom wedge at sub $90s.
Bearing in mind the highly anticipated earnings report around the corner, I’d expect the price of NVDA to hover around the current price range and only nose dive if the earnings report were to deliver anything less than impressive.
2. NVDA is trading above the upper BOLL band without force
95% of price movements happen within the BOLL bands and these rules are relevant even for the most bullish of stocks. Current price movements are trading above the Upper BOLL band situated at $128.
Most tickers pull back into the BOLL range shortly in the following days unless a breakout with force is seen such as the colossal bull run from TSLA in early Jul’24.
3. There is a negative Price vs Volume divergence
At a 1D timeframe of NVDA, the rising price movement of NVDA is diverging from the lowering trading volume. This forms a well-established ‘negative divergence’ rule which indicates a slow exhaustion of buying pressure. These are usually signs of a peak.
The same negative divergence occurred to NVDA a few weeks back on 23 May’24 - 18 Jun’24 where prices elevated against falling volume and eventually trended downwards as buyers exhaust.
Important Price Levels To Observe
$135 - The Breakout Zone
If NVDA, despite the odds manages to close above the $135 level (the previous high), this indicates a breakout from the falling wedge and a new bullish trajectory will be formed. It’s important to combine the earnings report and this price movement for confirmation and to avoid a false breakout.
$93 - Projected Crossing Point of EMA200 & Lower BOLL Bands
If price movements follow the speculated downward trend, we are expecting a new bottom to form at the $93 price level which is supported by both the EMA200 and Lower BOLL band.
A cross below EMA 200 signals a bearish market outlook and I see no reason for NVDA to flip side as its future prospect remains strong coupled with its unrivalled wide MOAT.
Note: My current TA readings cover short-term movements and I strongly believe the overall trajectory of NVDA remains bullish. Inactive long-term traders should be unbothered and remain on track.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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I’ll like a glass of wine, some crayons and a typewriter
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knowledgeisstrength : Thanks for the very detailed description and very systematic analysis and reading of the various technicals which I found highly useful and practical. To be clear that my understanding of the setup is correct, I have made a graphic which I would appreciate very much if you could review and affirm:
Daily Chart of Nvidia
A: Bollinger Upper Bound
B: Bollinger Mid
C: Bollinger Lower Bound
D: Falling Wedge Upper Bound
E: Falling Wedge Lower Bound
F: EMA 200 line
G: Falling Volume in Rising Prices
H: KDJ
Thank you !
cnkj OP knowledgeisstrength : Hi there. Yes, your setup is similar to mine and what I’m seeing. Personally, i like to keep my charts neat so it’s easier to read. If you’d consider:
B: I’ve removed the mid BOLL from my charts as they do not hold much weight compared to the EMAs.
H: KDJ, I’ve removed the J (variance) line from my charts to declutter. K&D lines provide me with enough information on the trend. I use KDJ to look into overbought/oversold data instead of the conventional RSI.
You can consider adding MACD. The trend lines may lag behind the KDJ but they are less volatile and are often used as a more reliable way to look at longer-term trends.
Hope these help.
knowledgeisstrength cnkj OP :![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
thanks for reviewing and sharing your experience , I'll make the changes recommended and start watching the markets with these