Breakout Alert: Nvidia (NVDA)
Revolutionary AI-Optimised Graphics Propel Nvidia's Breakout
After months of sideways consolidation, Nvidia’s share price broke and closed decisively above resistance during yesterday's session – potentially reigniting the stocks powerful long-term uptrend.
Nvidia, a key player in the AI revolution, had an exceptional 2023, with its stock value more than tripling. However, the majority of these gains occurred in the first half of the year. Since summer, Nvidia's stock has been consolidating within a sideways range, as indicated in the chart below.
These prolonged consolidation phases within an established trend are not just typical but also beneficial. They facilitate stock rotation, involving accumulation and distribution, which helps prevent the trend from becoming overly stretched.
The breakthrough to new trend highs occurred following Nvidia's announcement of groundbreaking desktop graphics processors tailored for AI purposes—the GeForce RTX 40 SUPER Series. This unveiling triggered a substantial 6.4% surge, propelling the stock to close at record highs. Additionally, ahead of the Consumer Electronics Show in Las Vegas, the company introduced other AI-related components and software.
Nvidia (NVDA) Daily Candle Chart
Past performance is not a reliable indicator of future results
A Closer Look
If we take a closer look at yesterday’s breakout, there are several technical factors which indicate that the breakout has potential to continue:
Backed By Volume: On the hourly candle chart (below) we can see that the breakout was backed by an increase in volume – signalling increased participation. Volume acts as a validation mechanism for breakouts. It provides confidence to traders that the breakout has a stronger chance of being a genuine shift in market sentiment, rather than a temporary blip.
Higher Swing Lows: From November to December, Nvidia’s share price had been carving out a series of higher swing lows as the market repeatedly tested resistance. This signals that institutional ‘smart money’ traders were accumulating shares prior to the breakout.
Strong Close: Yesterday’s price action saw the shares maintain the breakout into the closing bell. This signals strong demand and reduces the probability that the breakout will fail.
Nvidia (NVDA) Hourly Candle Chart
Past performance is not a reliable indicator of future results
Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
After months of sideways consolidation, Nvidia’s share price broke and closed decisively above resistance during yesterday's session – potentially reigniting the stocks powerful long-term uptrend.
Nvidia, a key player in the AI revolution, had an exceptional 2023, with its stock value more than tripling. However, the majority of these gains occurred in the first half of the year. Since summer, Nvidia's stock has been consolidating within a sideways range, as indicated in the chart below.
These prolonged consolidation phases within an established trend are not just typical but also beneficial. They facilitate stock rotation, involving accumulation and distribution, which helps prevent the trend from becoming overly stretched.
The breakthrough to new trend highs occurred following Nvidia's announcement of groundbreaking desktop graphics processors tailored for AI purposes—the GeForce RTX 40 SUPER Series. This unveiling triggered a substantial 6.4% surge, propelling the stock to close at record highs. Additionally, ahead of the Consumer Electronics Show in Las Vegas, the company introduced other AI-related components and software.
Nvidia (NVDA) Daily Candle Chart
Past performance is not a reliable indicator of future results
A Closer Look
If we take a closer look at yesterday’s breakout, there are several technical factors which indicate that the breakout has potential to continue:
Backed By Volume: On the hourly candle chart (below) we can see that the breakout was backed by an increase in volume – signalling increased participation. Volume acts as a validation mechanism for breakouts. It provides confidence to traders that the breakout has a stronger chance of being a genuine shift in market sentiment, rather than a temporary blip.
Higher Swing Lows: From November to December, Nvidia’s share price had been carving out a series of higher swing lows as the market repeatedly tested resistance. This signals that institutional ‘smart money’ traders were accumulating shares prior to the breakout.
Strong Close: Yesterday’s price action saw the shares maintain the breakout into the closing bell. This signals strong demand and reduces the probability that the breakout will fail.
Nvidia (NVDA) Hourly Candle Chart
Past performance is not a reliable indicator of future results
Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.