Technical Analysis – Is Nvidia’s uptrend ready to crack?
October 31, 2023 1:26 pm
Nvidia’s stock prints bearish trend pattern
400 could be critical for a negative reversal
Nvidia’s stock has formed a bearish head and shoulders pattern near its all-time high of 497.90. This suggests that the upward trend of almost one year may be over.
The negative structure is not officially approved as the bears have yet to drive clearly below the neckline of 400. Meanwhile, the RSI is still hovering below its 50 neutral mark, although being near a former support area, while the MACD remains negatively charged below its zero and signal lines, reducing the odds for a meaningful rebound.
If the price drops below the 400 threshold, support could next develop within the 375 region. The 200-day SMA, which overlaps with the 38.2% Fibonacci mark of the latest upleg, could act as a safety net against more aggressive declines to 303. Another failure there would wipe out May’s positive gap, shifting the long-term outlook to neutral.
On the upside, the 20- and 50-day simple moving averages (SMAs) could ruin any bullish attempts at 435 and 445, respectively. Even higher, the 2023 constraining line could cease any additional increases near October’s resistance of 468. If the bulls snap the bearish trend formation above it, they may next target the tentative resistance line from 2021 at 505 in the uncharted territory.
All in all, Nvidia’s three-month consolidation phase seems to have transformed into a bearish trend pattern, with sellers likely waiting for an extension below 400 to take the lead.
Nvidia’s stock prints bearish trend pattern
400 could be critical for a negative reversal
Nvidia’s stock has formed a bearish head and shoulders pattern near its all-time high of 497.90. This suggests that the upward trend of almost one year may be over.
The negative structure is not officially approved as the bears have yet to drive clearly below the neckline of 400. Meanwhile, the RSI is still hovering below its 50 neutral mark, although being near a former support area, while the MACD remains negatively charged below its zero and signal lines, reducing the odds for a meaningful rebound.
If the price drops below the 400 threshold, support could next develop within the 375 region. The 200-day SMA, which overlaps with the 38.2% Fibonacci mark of the latest upleg, could act as a safety net against more aggressive declines to 303. Another failure there would wipe out May’s positive gap, shifting the long-term outlook to neutral.
On the upside, the 20- and 50-day simple moving averages (SMAs) could ruin any bullish attempts at 435 and 445, respectively. Even higher, the 2023 constraining line could cease any additional increases near October’s resistance of 468. If the bulls snap the bearish trend formation above it, they may next target the tentative resistance line from 2021 at 505 in the uncharted territory.
All in all, Nvidia’s three-month consolidation phase seems to have transformed into a bearish trend pattern, with sellers likely waiting for an extension below 400 to take the lead.
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