Keep an eye on these Nvidia share price thresholds as stock soars following a robust earnings report.
After surpassing Wall Street's expectations for quarterly revenue, Nvidia (NVDA) shares surged in extended trading on Wednesday. The AI chipmaker saw its sales rise 69% to $44.06 billion in the first quarter, coinciding with a boom in AI demand from major tech companies. Despite the company incurring a $4.5 billion charge in the quarter due to restrictions on H20 chip sales to China, this figure was lower than the initially anticipated $5.5 billion.
CEO Jensen Huang emphasized the continued strength of global demand for Nvidia's AI infrastructure, attributing the trend to the increasing mainstream use of AI agents. The stock dipped between January and early April due to concerns over AI spending and trade policies, but it has rebounded by 56% since then, following relaxation of trade tensions and a partnership with an AI subsidiary of Saudi Arabia's sovereign wealth fund.
In after-hours trading Wednesday, Nvidia shares climbed nearly 5%, reaching just above $141—a level not seen during regular trading hours since February. Technical analysis applied to Nvidia's four-hour chart indicates three major overhead resistance areas to watch if the stock continues to rise, as well as a crucial support level to keep an eye on during potential price decreases.
The first overhead resistance to watch is around $143, due to the area's proximity to a significant mid-February swing high and notable trading activity dating back to late October. Overcoming this barrier may trigger further bullish momentum and could propel Nvidia shares to approximately $150, a level that includes multiple price peaks seen in 2021.
Should the stock breach the $150 level, some investors reluctant to hold onto their positions at prior lower averages may choose to sell, potentially creating a pullback. However, if the stock continues its upward trend, the bars pattern tool projects an even longer-term price target around $160, nearly 20% higher than the current level.
In terms of potential support, investors may find opportunities below the $130 level, which marks a multi-month horizontal line connecting the bottom of the flag pattern to a series of peaks and troughs on the chart dating back to August 2020. It's worth noting that the stock's price action has consolidated above its 200-day moving average, providing structural support during the current flag pattern.
While some investors have been sitting on the sidelines ahead of the highly anticipated earnings report, the significant rally following the breakout, aligned with a confirmation of the golden cross formation (50-day moving average crossing above the 200-day MA), suggests that this report could serve as an additional catalyst for further price movement in the coming days.
- The surge in Nvidia (NVDA) shares in extended trading, following their impressive first-quarter results, may prompt more investors to engage in trading activities, given the increased mainstream use of AI agents and the continuous strength of demand for Nvidia's AI infrastructure.
- Technical analysis suggests that the stock-market trend of Nvidia could be influenced by various factors, such as the three major overhead resistance areas, including one around $143, and a crucial support level around $130, especially during potential price decreases.
- The triumphant performance of Nvidia in the finance sector, demonstrated by their ability to recover from trading dips and maintain growth despite challenges, could potentially attract more investments, including Initial Coin Offerings (ICOs) and other technology-oriented ventures, given the increasing role of technology in the AI and finance industries.
