Key takeout
NVIDIA (NVDA) shares fell nearly 7% on Wednesday after the company said it was expected to receive a $5.5 billion bill as a result of US restrictions on exports of AI chips to China.
The company said that, with regulatory submissions, it would need to have an export license to sell the popular H20 chips to China amid concerns that Beijing could use to build supercomputers. The development was caught off guard given that NVIDIA designed the H20 graphics processing unit (GPU).
Nvidia’s stocks have made a modest recovery above this month’s low, but have lost almost the value from the near-age date on Wednesday amid uncertainty over Washington’s trade policy and massive technology spending.
Below we take a closer look at Nvidia’s charts and apply technical analysis to point out the key pricing levels that are worth paying attention to.
The doji candlestick pattern indicates indecisiveness
After attracting purchases near the lower trendlines of last week’s fall, Nvidia’s shares rallied sharply before hitting sales pressure near the top trendlines of the pattern.
It is worth noting that stock prices fell sharply during Wednesday’s trading session, but prices formed doji and a candlestick pattern suggesting indecisiveness between buyers and sellers.
Identify key support and resistance levels on Nvidia charts that investors may be monitoring.
Important support levels to monitor
Nvidia’s shares fell 6.9%, closing Wednesday’s session to $104.49.
Further sales of the stocks first reveals that price revisiting support is around $96. The area could attract buyers near the prominent Twin Peaks last March. This is the chart location just above this month’s tariff-driven low.
The Bulls’ failure to follow their April lows could lead to a massive drop to the $76 level. Investors can look for purchase and retention entry points for this area near the low swing last April.
Important resistance levels to monitor
A breakout volume back over the top trend line of a falling wedge pattern could move around $130, currently just above the 200-day moving average. The stock could face overhead resistance in this area near the August peak and December’s Trough.
Finally, if you go above this level, Nvidia’s shares can rise to $150. Investors may decide to lock in profits at this price near some of the peaks formed in the charts just below the stock’s record highs in early January.
This area also matches the predicted measured travel price target, which calculates the depth of the falling wedge of the point and adds that amount to the top trend line of the pattern. For example, adding an additional $40 to $110 would predict an upside target of $150.
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As of the date this article was written, the author does not own the above securities.
