Nvidia is getting closer to a key resistance area

JFD Team JFD

The Nvidia Corporation stock (NASDAQ: NVDA) traded higher on Tuesday, after it hit support at 464 on Monday. The rebound took the price slightly above the psychological zone of 500, which is also Friday’s high, but the move was cut short, with the stock pulling back near that psychological zone. Overall, the price structure on the 4-hour chart remains of lower peaks and lower troughs and thus, despite yesterday’s recovery, we will take a somewhat-negative approach.

Even if Nvidia recovers a bit more, we see decent chances for the advance to stop near the key 512 resistance zone, which acted as a strong support between November 10^th and January 27^th. If investors decide to abandon the stock near that hurdle, we may see a slide back below 500, something that may open the way towards Monday’s low of 464. A break below 464 would confirm a forthcoming lower low and may set the stage for extensions towards the low of August 11^th, at 432.

Shifting attention to our short-term oscillators, we see that the RSI, although it exited its below-30 zone and got closer to the 50 line, shows signs that it could turn down again. The MACD, although within its negative territory, remains above its trigger line still pointing up. The RSI suggests that the price may turn south again soon, but the MACD implies that we may see some more recovery before that, perhaps for a test near the aforementioned 512 zone.

Now, in order to start examining larger advances, we would like to see a clear move above 529, which is the inside swing low of February 25^th. This may open the path towards the 555 hurdle, marked as a resistance by the highs of March 1^st and 2^nd, the break of which may see scope for extensions towards the peak of February 24^th, at 580.

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