Nvidia Faces Imminent Move, No Sideways Option
Last week, while almost all labor market data indicated signs of economic slowdown, the non-farm payroll report delivered a heavy blow to those betting on a rate cut. The U.S. added 272,000 non-farm jobs in May, significantly surpassing market expectations. Average hourly earnings, a barometer of inflation, also exceeded forecasts, suggesting that the job market remains robust and labor supply is tight. Although the three major indices exhibited minimal reaction, gold prices plummeted and the dollar strengthened. Currently, the market is waiting for the FOMC and CPI data, as well as observing whether Nvidia will continue to rise after stock split or enter a decline driven by profit-taking.
For $NVIDIA(NVDA.US$, after completing a 1-for-10 stock split on Monday, the stock price did not immediately form a decline driven by profit-taking as I had anticipated. Instead, it has maintained a short-term sideways movement, awaiting the outcome of the tug-of-war between bulls and bears. From a technical perspective, Nvidia is still in an uptrend, or at least there are no clear signals indicating the end of this uptrend. The EMA still shows a bullish alignment, and the stock price remains steadily above the short-term EMA, with the green ladder pattern yet to conclude(Please refer to my other article for this custom indicator).
Currently, it is important to note that the absence of a dominant profit-taking force is mainly due to the market's continued optimism about Nvidia's future growth. However, if the stock stays around the current level for too long (3 to 5 trading days), profit-takers may gradually lose their patience and start selling to secure their gains. Unfortunately, the stock is at an all-time high (ATH), meaning almost everyone is in profit. Once profit-taking begins, investors will rush to preserve their gains by selling as quickly as possible, potentially leading to a sharp decline in the stock price.
Last Friday before the market opened, I mentioned that if $Apple(AAPL.US$ failed to break through the resistance level at 195, then the 192-193 range would become its support. As it turned out, although Apple briefly broke above 195 on Friday, the company's event seemed to leave most investors unimpressed, and by Monday, the stock had returned to the 193 support level.
From the chart, the price is currently supported by a relatively flat trendline, but it still faces resistance at 195 and a directional decision is imminent in the short term. Personally, I believe the likelihood of breaking above 195 is slim. It is more probable that the stock will break below the 193 support level today or tomorrow and seek support at 187. Time will tell.
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TA fan | People overreact all the time and the chart helps us make use of that
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Maniac Fool : Look at the Profit Ratio (PR) as a gauge. 97+% now
Maniac Fool : Apple broke through
ZmjjkK OP Maniac Fool : haha, don't know why