Semiconductor giant Nvidia (NVDA) is scheduled to report their latest quarterly results this Wednesday after the market close. A review of the charts is in order.
In the daily bar chart of NVDA, below, I see that the shares are starting a pullback or correction. NVDA made a low in October and staged two rallies. The first rally extended upward into December and then prices corrected. Another rally got underway in early January and lasted into February.
NVDA has pulled back in recent sessions. The stock is still above the rising 50-day moving average line. The slope of the 200-day has turned positive.
Trading volume looks like it has declined since October. The On-Balance-Volume (OBV) line has followed the price action on the upside and on the downside. The Moving Average Convergence Divergence (MACD) oscillator has crossed to the downside for a take profit sell signal.
In the weekly Japanese candlestick chart of NVDA, below, I can see two upper shadows above $220 telling me that traders have recently rejected the gains above this level. The shares are above the bottoming 40-week moving average line.
The weekly OBV line shows a rise from October. The MACD oscillator is above the zero line but shows the start of narrowing.
In this daily Point and Figure chart of NVDA, below, I can see a potential downside price target in the $180 area.
In this weekly Point and Figure chart of NVDA, below, an upside price target in the $409 area is shown.
Bottom-line strategy: In the short-run the charts and indicators suggest that NVDA could correct further to the downside. Maybe Wednesday's earnings report is the impetus for the correction. Longer-term, NVDA shares could climb further in the latter part of 2023 and into 2024.
Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.