Nvidia Stock Price Analysis: Watch Key Support and Resistance Levels Amid Market Volatility

Essential Insights

• Nvidia's shares experienced a sharp decline amid rising concerns over a cost-effective AI model from Chinese startup DeepSeek, potentially impacting Big Tech’s spending on Nvidia’s premium AI products.
• The stock fell below a seven-month ascending wedge pattern and closed under the critical 200-day moving average, signaling possible continued downward momentum.
• Investors should focus on key support zones near $102, $96, and $76, while also keeping an eye on resistance around the $130 mark.

On Monday, Nvidia (NVDA) shares dropped sharply as the market reacted to the emergence of a powerful and affordable AI technology developed by the Chinese startup DeepSeek. This innovation threatens to reduce the substantial investments Big Tech companies have been making in Nvidia’s advanced AI hardware.

Major hyperscalers like Microsoft (MSFT), Alphabet (GOOG), and Amazon (AMZN) have heavily invested in Nvidia’s AI platforms over recent years to support the growing demand for artificial intelligence infrastructure. This demand has propelled Nvidia into the ranks of the world’s most valuable companies.

Despite falling 17% to $118.58 on Monday, wiping out nearly $600 billion in market capitalization, Nvidia’s stock has still nearly doubled over the past year and surged over eight times since the introduction of OpenAI’s ChatGPT in late 2022.

Below is an in-depth technical analysis of Nvidia’s stock chart, highlighting key price levels to watch following the recent selloff.

Breakdown of Rising Wedge Pattern

On Monday, Nvidia’s stock broke down from a seven-month rising wedge and closed below the important 200-day moving average, a technical signal that could trigger further selling pressure.

The selloff was accompanied by the highest daily trading volume since May, indicating significant repositioning by large investors.

Let’s examine three critical support levels and one notable resistance level to guide investors through potential price movements.

Critical Support Levels to Monitor

The first key support is around $102, near the opening price of a May breakaway gap and close to the early September lows. This level may provide initial buying interest.

If Nvidia’s price falls below $102, the next support is near $96, a zone marked by March’s double peaks and early August’s low, offering another potential entry point.

A deeper correction could push shares down to approximately $76, roughly 36% below Monday’s close, aligning with last year’s mid-April swing low, which may attract value-focused investors.

Important Resistance to Watch

On any rebound, investors should watch the $130 resistance zone. A sustained move above the 200-day moving average could lead to a retest of a significant trendline connecting the August high and the lows formed in December and January.

Disclaimer: The information provided is for educational purposes only and does not constitute financial advice. Please review our warranty and liability disclaimer for more details.

As of the article's publication date, the author holds no positions in the securities mentioned.

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