Hello everyone, this week's Tech Tracker analyzes the brightest leader in the US stock market - Inweida$NVIDIA(NVDA.US)$.
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Hot Spot Events
ENVIDA'S STOCK PRICE FELL 2% TO $853.54 ON TUESDAY (APRIL 9), SIGNALING THAT THE STOCK HAS OFFICIALLY ENTERED THE “TECHNICAL ADJUSTMENT” ZONE.
The so-called “adjustment zone”, a technical definition used by Wall Street, refers to the stock price pulling back 10%-20% from bull market highs. In addition, once a stock price retracement exceeds 20%, it is defined as a “bear market”.
In the case of Indira, the highest closing price of the stock was recorded on March 25 at $950.02. ACCORDING TO THIS CALCULATION, WHEN ENVIDA'S CLOSING PRICE FALLS BELOW $855.02, IT OFFICIALLY ENTERS THE ADJUSTMENT ZONE; IF THE STOCK PRICE FALLS FURTHER BELOW $760.02 IN THE FUTURE, IT MEANS THAT THE MOVEMENT WILL TURN BULLISH TO BEAR.
Simply put the background to the Indyda share price adjustment. The company unveiled a brand new Blackwell-based AI chip at the GTC Developer Conference 2024 on March 18-21, followed by a sharp jump in the share price and hit a record high in the next few days. However, as the market heat has cooled, Inweida's share price has now fallen to slightly below the level it was before the GTC meeting.
It is worth noting that the recent performance of the “tech giants” in the US stocks has been poor. In addition to Nintendo, Apple has also entered the technical adjustment zone, and worse, Tesla is already in the technical bear market. Four other giants — Google, Amazon, Meta and Microsoft — are still hovering near historic highs.
Regarding the long-term outlook for Inweida, D.A. Davidson analyst Gil Luria expressed a cautious view, saying that it could achieve great success in the next two years, but face a severe cyclical recession by 2026.
The analyst gave the stock a “hold” rating with a target price of $620, which is at Wall Street's lowest target price. According to FactSet data, 53 Wall Street analysts currently give Indira a “buy” rating, 7 analysts give it a “hold” rating and no “sell” rating at the moment; the analysts' average target price is $972.95.
Needless to say, Indo is a strong leader in this round of US bull markets, but the question also arises: does it mean that there will be a risk of a pullback on the US stock market once it weakens?
Technical analysis
Trend analysis:
1. The pie chart shows that Inweida launched a bull market from October 2022 to July 2023, and its share price rose by more than 280%.
2. From July-December 2023, the stock price has been sorted crosswise within the rectangular area.
3. In early 2024, the share price resumed its upward trend, surging above $900.
4. In recent weeks, the share price has bounced back, dropping more than 10% compared to the highest close on March 25.
Indicator Interpretation:
The daily chart shows that Inweida's share price has fallen below the 20-day average (MA20) for several consecutive days, and the 50-day average (MA50) will be tested.
The daily chart is suspected of having a “double top” pattern, with the potential neckline near $850.
Trading volumes have been below the 10-day trading average for several days in a row, suggesting that market participation has decreased.
The 14-day RSI fell below the 50-mark line, the first time this phenomenon has occurred since the beginning of the year.
Looking at the pie chart, Indyda shares have fallen for three consecutive weeks, while the RSI indicator still shows overbought (>70), the KDJ indicator has broken out of the overbought zone (<80), suggesting that the market may need a pullback or pause for some time.
Direction of attention:
ENVIDA'S SHARE PRICE IS CURRENTLY AT A 1-MONTH LOW, AND IN THE SHORT TERM, THE 50-DAY AVERAGE WILL BE AN IMPORTANT MULTI-VOID WATERSHED, AND CONCERN IS WHETHER THE NECKLINE POSITION OF THE POTENTIAL DOUBLE-PEAK FORMATION ($850) CAN BE MAINTAINED.
This content discusses technical analysis, and other approaches, including fundamental analysis, may provide different perspectives. The examples provided are for illustrative purposes only and do not reflect the expected results.
All investments involve risk, including the potential loss of principal, which cannot guarantee the success of any investment strategy.
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