Subject: NVDA - Upcoming Convergence
In my opinion, NVDA is setting up for a notable move after upcoming convergence on or around the new year. This is evidenced by a few underlying factors.
The recent drop (12/20) was simply a mild sell off to capitalize on the large impulsive move that began around 10/31/23. I believe we see another retest of historical resistance on or around the new year. The price has followed an upward trend, which is showcased in bright blue. This has acted as strong support, directing it towards upcoming convergence at the $497 level.
Waiting to see if this forms into a double top pattern or continues to push up after convergence. The Fibonacci retracement levels paint the picture for a continuation after consolidating at the 50% level. This is further supported by a majority of analysts price targets above $500 plus. However, both the RSI and MacD indicators do not showcase strong upward momentum.
Based on global factors along with other magnificent seven trends, my general theory is we will see a break above $500 and then consolidate again at the $490 - $500 levels. I am playing things safe right now with Bull Put Spreads and cash-secured puts at the $450 and $470 levels respectively. I see a strong value buy at the $470 - $480 levels - don't mind being assigned.
Will continue to update this post as time goes on - we'll see what Santa brings NVDA.
In my opinion, NVDA is setting up for a notable move after upcoming convergence on or around the new year. This is evidenced by a few underlying factors.
The recent drop (12/20) was simply a mild sell off to capitalize on the large impulsive move that began around 10/31/23. I believe we see another retest of historical resistance on or around the new year. The price has followed an upward trend, which is showcased in bright blue. This has acted as strong support, directing it towards upcoming convergence at the $497 level.
Waiting to see if this forms into a double top pattern or continues to push up after convergence. The Fibonacci retracement levels paint the picture for a continuation after consolidating at the 50% level. This is further supported by a majority of analysts price targets above $500 plus. However, both the RSI and MacD indicators do not showcase strong upward momentum.
Based on global factors along with other magnificent seven trends, my general theory is we will see a break above $500 and then consolidate again at the $490 - $500 levels. I am playing things safe right now with Bull Put Spreads and cash-secured puts at the $450 and $470 levels respectively. I see a strong value buy at the $470 - $480 levels - don't mind being assigned.
Will continue to update this post as time goes on - we'll see what Santa brings NVDA.
Comment:
As expected, NVDA made a substantial move after reaching convergence on 1/1/24. Unfortunately, not the desired move but it did find strong support in the price range I targeted. Continuing to watch consolidation play out between the $480-$490 range. I've now established and sold put options at the $465 price range - currently a strong value buy at that level. Happy New Year!
Comment:
This has aged pretty nicely, I was slightly off on the consolidation price ranges. Enjoying the strong momentum above $500 - waiting on the top to form. From there I want to see where consolidation happens. My general theory is it will still occur between $490-$500 price range. However, I would love to see strong support and consolidation at or above the $500 mark. I've been profiting off cash-secured puts and Bull Put Credits spreads in the $460-$480 price ranges. I still see a VERY strong value buy at the $480-$490 level. I also see a strong continuation through EOY once volume builds above the $500 threshold. Be patient with NVDA and don't get greedy - that's my best advice.