NVIDIA's performance exceeds expectations again! Is the stock price brewing a new breakthrough? (2024.11.21)

Hello everyone, this week's 【Technical Tracking】 will analyze the leaders in the global semiconductor and artificial intelligence (AI) fields——NVIDIA. $NVIDIA(NVDA.US)$ Stimulated by strong third-quarter performance, NVIDIA's stock price once hit a historical high; does this indicate that the stock will continue to surge?

Hot Events

On November 21, 2024 (Wednesday), NVIDIA released its third-quarter earnings report, with revenue and profit exceeding Wall Street's expectations, highlighting strong market demand for its AI chips, driving sustained rapid growth in the company’s performance.

Looking ahead, NVIDIA predicts fourth-quarter revenue of about $37.5 billion (fluctuating by 2%), higher than Wall Street analysts' expectations of $370.8 million. This performance guidance indicates a year-on-year growth rate of about 70%. In contrast, the growth rate for the same period last year was 265%.

On the first trading day after the earnings report was released, NVIDIA's stock price experienced significant fluctuations. The stock rose over 4% in early trading, setting a new historical high, but also fell over 3% during the day, ultimately closing up slightly by 0.5%. This dramatic oscillation trend indicates that investors have high expectations for this AI giant, and even an earnings report that exceeds expectations may not satisfy the discerning appetite of some investors.

As the absolute leader in the current AI field, NVIDIA's stock price seems to be on an upward trajectory without slowing down. Since the beginning of the year, the stock has soared nearly 200%, matching last year’s full-year increase of 240%.

Goldman Sachs Analyst Toshiya Hari has the following views on NVIDIA's earnings report: NVIDIA's Q3 performance exceeded expectations; the demand for the new Blackwell architecture AI chips is strong; last generation's Hopper architecture AI chips will continue to be shipped until 2025; NVIDIA still faces supply shortages; maintains a "Buy" rating for the stock and includes it in the "Conviction Buy List."

Goldman Sachs analysts have an average Target Price of $165.18 for NVIDIA, indicating a potential increase of 13% compared to Thursday's closing price. Currently, Wall Street is unanimously Bullish on the stock. Data shows that among the 41 analysts tracking NVIDIA, only one has given a "Hold" rating, while the other 40 have assigned a "Buy" rating.

Technical Analysis

Trend analysis:

The daily chart shows that NVIDIA's price trend is very clear, and it has been running within an ascending channel for the past few months. Although the stock briefly dipped below the lower edge of the channel in recent days, indicating some subtle changes in market sentiment, this type of short-term fluctuation is common in an upward trend and can be interpreted as profit-taking by some investors, which does not challenge the overall trend and has not broken the integrity of the ascending channel.

Indicators interpretation:

● The major moving averages for NVIDIA's stock price are in a bullish configuration, meaning that the short-term moving averages are all above the long-term moving averages and are trending upwards. This is formed from the stock's stable upward trend, indicating strong upward momentum.

● The MACD Indicators are above the zero line, but a "death cross" has occurred, indicating that although the overall trend looks bullish, a pullback or consolidation may occur in the short term.

● A "morning star" Candlestick pattern appeared during the brief pullback in stock price. This pattern is a bullish Candlestick formation and may indicate the return of bulls and drive the stock price back upwards.

● Pay attention to the potential Resistance near $131 below the stock price. This point was the high on August 26, where the stock price faced multiple obstacles but after breaking through, it repeatedly set historical highs, thus transforming from a resistance level to a support level.

Overall, while NVIDIA's stock price faces some short-term profit-taking pressure, the overall trend and upward channel remain favorable. The stock experienced significant fluctuations after the Earnings Reports were released, indicating intense competition between bulls and bears, which is a typical market reaction leaning towards neutrality. In the short term, an upward breakout may face resistance at the $150 integer level, which might require further digestion of the investors' profit-taking pressure.

This content discusses technical analysis; other methods, including Fundamental Analysis, may provide different perspectives. The examples provided are for illustrative purposes only and do not reflect expected results.

All investments involve risks, including the potential loss of principal, and there is no guarantee that any investment strategy will be successful.