Nvidia analysts are watching these key stock levels for further losses as ‘exhaustion’ sets in

• Nvidia stock has seen increased volatility, with the company down 16% since reporting earnings last week.

• Technical analysts have identified key support levels for the stock price at $100 and $90.

• A technical analyst pointed out that there is a buying opportunity for Nvidia if the stock falls to its 200-day moving average.

All eyes are on Nvidia as the stock faces a heavy sell-off following the release of its second-quarter earnings on Wednesday.

With the stock price down as much as 16% over the past week despite beating earnings expectations, investors are wondering where and when the stock price will bottom.

Business Insider spoke with technical analysts with a knack for reading charts to gauge their observations on Nvidia’s current share price performance and what the stock might move next.

Analysts say there are two major obstacles facing Nvidia stock that could make or break the company’s long-standing market leadership position.

The first is the psychological $100 level, followed by the all-important 200-day moving average, which is just below $90. That level also corresponds to the low reached on August 5.

Shares of Nvidia traded in a range of $104-$110 on Wednesday.

“The 200-day moving average is currently around $89 and also matches the intraday low from August 5, so for us there has been no change in the stock’s long-term trend above this support,” Ari Wald, technical analyst at Oppenheimer, told Business Insider.

Wald said he wasn’t necessarily surprised by the recent weakness in Nvidia shares, as September is a seasonally weak period for the broader market.

If Nvidia shares approach their rising 200-day moving average, where they’ve been above since January 2023, Wald would see that as “an opportunity to buy the stock’s intact uptrend.”

According to Katie Stockton, founder of Fairlead Strategies, Nvidia shares appear tired and could continue to move sideways for a while.

“NVDA is showing signs of mid- to long-term upside exhaustion from an overbought/oversold perspective. We expect the stock to remain in the digestion phase for a few more months,” Fairlead Strategies said.

If Nvidia shares manage to trade above the key support level around $90, the stock could eventually reach the resistance level of $130 and above, Stockton said.

That represents a potential upside of at least 19% from current levels.

Adam Turnquist, technical strategist at LPL, told Business Insider that Nvidia’s stock has seen some minor price swings in recent weeks.

In August, the stock missed its July highs and fell below its 20- and 50-day moving averages.

The story continues

“Volume and momentum indicators point to more downside risks ahead, with support around $100 (psychological level and August lows), $95 (March highs) and around the $88.50-$90.69 range (200-day moving average / intraday low in August),” Turnquist explained to Business Insider.

A similar story is playing out in Nvidia’s chart versus the S&P 500, and danger could loom if Nvidia drops below its August intraday low of $90.69, Turnquist said.

“A drop below the August lows on the ratio chart could indicate that NVDA may be losing its market leadership status,” Turnquist said.

Here’s a technical overview from Nvidia with the various price points to keep an eye on in the future.

Read the original article on Business Insider