Key Takeaways
- Nvidia shares fell for the fourth straight session on Tuesday, extending their slide into a technical correction as the stock is down 15% from last month’s record high.
- After setting a record high, the stock traded mostly sideways before falling below the 50-day moving average late last week. potentially setting the stage for further consolidation.
- Investors should watch key support levels on Nvidia’s chart around $115 and $102, while also monitoring important resistance levels near $140 and $150.
Nvidia (NVDA) shares fell for the fourth straight session on Tuesday, extending their slide into a technical correction as the stock is down 15% from last month’s record high.
While analysts remain bullish on the company’s prospects heading into 2025, investors may be wanting further confirmation that the chipmaker can sell significant volumes of its new Blackwell chips after the reported discovery of overheating issues last month prompted concerns over production delays.
Depsite its recent slump, the stock is still up about 160% since the start of the year, far outpacing the S&P 500’s 27% return over the period, amid booming demand for the company’s AI silicon.
The stock fell 1.2% to close Tuesday’s session at $130.39.
Below, we take closer look at the AI chipmaker’s chart and use technical analysis to identify important price levels to watch out for.
50-Day Moving Average Breakdown
After setting a record high in November, Nvidia shares traded mostly sideways before falling below the 50-day moving average (MA) late last week, potentially setting the stage for further consolidation.
While stock volume remains below longer-term averages, it has edged up in recent trading sessions, pointing to an increase in selling activity. Moreover, the relative strength index (RSI) has slipped below 50, confirming weakening price momentum.
Let’s turn to Nvidia’s chart to identify several key support and resistance levels that investors may be tracking.
Key Support Levels to Watch
Upon further selling, investors should initially keep an eye on the $115 level. Nvidia bulls may step up to the plate in this area near the 200-day MA, which also closely aligns with a range of comparable price action on the chart between May and October.
A breakdown below this important technical area could see the shares revisit lower support around $102, a location on the chart where investors may seek entry points near the low of a late-May breakaway gap and prominent troughs that formed in August and September.
Interestingly, this region also roughly matches a bars pattern projected target that takes the stock’s June to August correction and overlays it from November’s all-time high (ATH).
Important Resistance Levels to Monitor
If the stock regains its upward momentum, it’s worth monitoring how it responds to the $140 level. The shares may encounter resistance in this area near a horizontal line that links the June swing high with a series of similar price points between October and December.
Finally, further buying could propel a bullish move to around $150, a region on the chart where investors could decide to lock in profits near a cluster of candlesticks positioned just below the stock’s record high set late last month.
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