Research update

A running archive of NVDA (Nvidia) views from Tactical Positioning.

NVDA

NVDAWhatever sparks the bull run will eventually bring it to an end.

NVDA167 is the line of sand

NVDAI am placing a stop loss to the NVDA (Nvidia) short position at breakeven, and setting a target price of 168 and 75.

NVDA167 is the line in the sand for NVDA (Nvidia), and for the broader market.

NVDANVDA (Nvidia) posted a widely expected earnings beat after the close yesterday. Bulls shouldn't get overexcited yet, as NVDA remains below the 11/20 high, the day after last quarter's earnings. That level has acted as resistance for the past three months. The after hours earnings pop was quickly faded, and NVDA even traded in negative territory for a while. Today and tomorrow are key for the direction of the coming months.

NVDANVDA (Nvidia) failed to close above the 11/20 high and retraced sharply over the last two sessions. Friday's selloff into the close was particularly worth noting, as most of the MAG7 (Magnificent 7) rallied into the close while NVDA dumped. It seems NVDA is playing catch up to the downside so it can break below 167 at the same time as NDX (Nasdaq 100) breaks below 24,200, which would activate a true bear market that most of my dear subscribers have not experienced before.

NVDANVDA (Nvidia) remains above the line in the sand at 167. A break below this level unleashes the Kraken.

NVDANVDA (Nvidia) is the final missing piece.

NVDAAs warned, NVDA (Nvidia) left a fakeout before bouncing higher. This is common, especially for key names such as NVDA, which is the bellwether of the bull run, as bulls and algos will do their best to defend it. However, I do think this is just a relief rally before it reverses and breaks below the key 167 support level.

NVDAVery significant development in NVDA (Nvidia)'s price action, as it has broken above the key 196 resistance. As long as it holds this level, it could continue to lead the market higher.

NVDANVDA (Nvidia) led the market higher, as I expected. Note that NVDA now faces resistance from its previous ATH. Given how overextended the semiconductor sector is, I do not believe this attempt to make a new ATH is genuine. For bulls, wait for a confirmed break and enter on a pullback. For bears, this is a good entry, with a stop a few points above the ATH.

NVDAI shorted NVDA (Nvidia) on Monday around the HOD but was stopped out at breakeven. As I noted in last week's Tactical Positioning, I expected this push to a new ATH to be nongenuine, and the ATH area would be a textbook short entry. NVDA printed a new ATH on Monday but closed the week in the red, while semis and NDX closed in the green. For bulls, 196 must hold; otherwise, it risks another probe into the 167 area.

NVDANVDA (Nvidia) managed to hold my 196 support before reversing and closing above the key 208 level on Friday. This is a very bullish signal. A sustained close above 208, and perhaps a rally from here, would suggest an end to the consolidation over the past six months.

However, the steep rise in the semiconductor sector is flashing warning signs, as it increasingly resembles the classic pattern of a euphoric stage, often followed by a devastating correction. NVDA did not contribute much to this rally, but it is not immune to drawdowns once a correction is due in SOXX (Semiconductor ETF). For bulls, I would not chase it here. The entry opportunity was on the pullback toward 196. For bears, watch SOXX closely, along with key memory/storage names such as SNDK (SanDisk) and MU (Micron).

NVDAIf the market decides to put an end to this AI frenzy, NVDA (Nvidia) will likely post a monthly close below 208 and lead the market lower in the coming months. For bulls, the pullback is a low-risk entry. For bears, wait for a confirmed close below 208.

NVDAAs I laid out two weeks ago, if the market decides to put an end to this AI frenzy, NVDA (Nvidia) will likely post a monthly close below 208 and lead the market lower in the coming months. For bulls, the pullback into 208 is a low-risk entry. For bears, wait for a confirmed close below 208.

NVDA backtested that level on Wednesday, so this remains the level to watch. Despite missing out on the memory rally, NVDA is still the most important stock in the semi sector and the bellwether for this bull run.

NVDANVDA (Nvidia) broke below the key 208 level on Friday. This is perhaps the most important single-stock level to watch, as I have mentioned repeatedly over the past few weeks.

If NVDA fails to reclaim 208 in the coming sessions, this will very likely mark the beginning of the end of the AI frenzy.

NVDANVDA (Nvidia) is now trading below the key 208 level. If it fails to reclaim this level while the rest of the semi stocks continue to rally like there is no tomorrow, it would mark the beginning of the end.

NVDANVDA (Nvidia) is still the final missing piece. It reclaimed 208 after the prior breakdown and is now trying to hold that level from above. That makes 208 the line in the sand.

As long as NVDA holds 208, bears do not have a confirmed signal. A failure back below 208 would be much more important than a normal pullback, because it would suggest the AI trade is starting to lose its leader. Below 208, 196 comes back into play quickly.

NVDANVDA remains above the ascending trendline. With SOXX now below 530, NVDA is the final missing piece.

Unless NVDA reclaims 208 over the next few sessions, the ascending trendline at around 196 should remain under pressure. A confirmed break below the trendline opens the door to 167 and would confirm that the AI trade has lost its most important leader.

NVDANVDA has remained resilient over the past few weeks even as semis sold off. But the risk sits with the buyers funding the AI buildout. Off-balance-sheet vehicles and circular financing can keep capex flowing, but they cannot manufacture sustainable end demand. It is only a matter of time before NVDA joins the selloff.

A confirmed break below the ascending trendline opens the door to 167 and would complete the breakdown across the key semiconductor bellwethers.