NVIDIA Corporation (NVDA) Share has completed a three week Base Patterns above the 50-day moving average and rotated significantly higher to set the stage for a test of September all-time high near $ 590. A wave of positives Catalysts is driving the uptrend, which could gain momentum by the middle of the month. accumulation The readings have already hit new highs, generating a brisk tailwind that increases the chances of a successful breakout and moving towards $ 700.
The central theses
- NVIDIA stock could break out of September high.
- The buying interest has risen in the last few weeks and has raised the accumulation values to new highs.
- Innovation and new products are driving the strong upward trend.
BMO Capital Markets has increased its NVIDIA Price target from $ 565 to $ 650 on Tuesday, while Needham analyst Rajvindra Gill just highlighted the new computing unit, which is a “data center on a chip” that can accelerate CPU performance by doing “critical network, storage and security tasks.” “be outsourced. The state of the art could have important applications in the EU Cloud computing and artificial intelligence Communities that enhance NVIDIA’s already stellar reputation and bottom line.
In addition, the chip giant has just entered into a partnership with the artificial intelligence group at GlaxoSmithKline PLC (GSK) to apply calculations to the drug and vaccine discovery process. The implications are enormous, with the potential to target certain chemical and biological compounds through modeling rather than trial and error. It could also shorten the time to commercial market and lower the overall cost of research and production.
It’s hard to find NVIDIA bears on Wall Street these days. The stock is currently rated a “strong buy” based on 26 “buy” and 4 “hold” recommendations. Only one analyst thinks the stock is overvalued and advises shareholders to close positions at this point. Price targets currently range from a low of just $ 260 to a street high of $ 700, while the market leader will open the session on Wednesday about $ 18 below the median of $ 577.
Cloud computing is the provision of various services over the Internet. These resources include tools and applications such as data storage, servers, databases, networks, and software.
NVIDIA Daily Chart (2018-2020)
A multi-year uptrend started near $ 209 in October 2018, resulting in a sell-off that stretched nearly 170 points by year-end. The stock rose early in 2019 and spent the year preparing for its previous high again. It finally finished the task in February 2020 and broke out, but the rally quickly failed and resulted in a vertical dip, followed by a V-shaped rebound that made up 100% of those losses in May.
The subsequent breakout met with strong buying interest and lifted the stock in a channeled advance that continued with a few Retreats to the all-time high in September at USD 589.07. It fell nearly 120 points over the next three sessions and recovered in 50 days exponential moving average (EMA), starting with a support Test that lasted three weeks. The stock rallied from this trading venue at the end of the month and is now about 30 points below its previous high.
The Total volume The accumulation distribution indicator (OBV) has been gaining ground since June 2019 and often leads to bullish price movements. OBV made a new high in early September and entered a sales phase that lasted two weeks after the stock hit its low. The buying interest has risen since then and has canceled this volume Measurement at another all-time high. This, in turn, predicts that price will soon follow suit and eventually break out into the 600s.
Accumulation / distribution is a cumulative indicator that uses volume and price to assess whether a share will accumulate or be paid out. The measure of accumulation / distribution tries to identify Deviations between share price and volume flow.
The bottom line
NVIDIA stock rallied from support in late September and has now tested the bull market high near $ 590.
Disclosure: The author held no positions in any of the above securities at the time of publication.