🎁Head & Shoulders Top vs. Triple Bottom: $NVDA Targets $600?
The share price of $NVIDIA Corp(NVDA)$ broke through a new all-time high on Monday and fell slightly ahead of Tuesday's earnings release. Following the after-hours earnings release, $NVIDIA Corp(NVDA)$ rose 0.92% in pre-market trading on Wednesday.
What will happen to the price of $NVIDIA Corp(NVDA)$ after the results, will it continue to reach new highs or will it start to fall?
First, let’s look at the earnings results:
The overall quarterly revenue was $18.12 billion, significantly exceeding the analyst and management expectations of $16.1 billion; Adjusted net profit of $10bn, sharply beating analysts' expectations of $8.43bn.
At the same time, Nvidia’s guidance for the next quarter is also higher than market analysts’ expectations: $NVIDIA Corp(NVDA)$ expects revenue of around $20 billion in the next quarter, which is much higher than the 17.98 billion expected by analysts!
Then, let’s make some observations on technical patterns:
There are some views in the market that $NVIDIA Corp(NVDA)$ will turn downward and its stock price are now reaching a peak.
Some people believe that $NVIDIA Corp(NVDA)$ is now in a triple bottom pattern, but not head and shoulders top.
How to judge a pattern?
Let’s look at a head & shoulders top: when the right shoulder is lower than the left shoulder, and the price breaks down the neckline successfully, the pattern is formed.
Head and Shoulders Top - Chart Pattern
Then, let’s take a look at a triple bottom pattern: if you see 3 lows and the price breaks through the previous highs, it can form a new triple bottom pattern. The share price can offer even more upside potential with a symmetrical price range.
a triple bottom chart pattern illustration
Now, see the pattern of $NVIDIA Corp(NVDA)$
Obviously $NVIDIA Corp(NVDA)$ did not break through the neckline on October 31, and the head and shoulders top pattern was failed.
Nvidia shares continue to rebound and broke through all-time highs this Monday.
Once this breakout is established, refer to the pattern illustration above, $NVIDIA Corp(NVDA)$ will continue to rise, and the minimum increase range will be around $100 ($400-505—$505~600)to reach above $600.
Questions for Tigers
Head & Shoulders Top vs. Triple Bottom? What’s your choices?
Do you trust technical analysis?
Do you use technical analysis tools or principle trading to make trading decisions?
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
🌟🌟🌟Nvidia's share price fell 2.4% on Wednesday on news that US chips curb to China will affect its sales growth in that region. China is Nvidia's 3rd largest market.
Nvidia expected sales in Q4 23 maybe negatively impacted by this. However the shortfall will be more than offset by strong growth in other regions.
I believe that this is just a temporary setback and Nvidia will continue its strong growth trajectory well into the future.
While Technical analysis is useful to identify trends, it is still important to look at fundamentals and the news affecting Nvidia.
Nvidia is at the forefront of AI revolution and none of the Wall Street Analysts have a Sell Rating on Nvidia. Instead it is a Buy Rating, Target price of USD 600.
So I believe the technical pattern is a Triple Bottom and Nvidia's share price will be going up like a rocket to the moon in December.
@Tiger_chat
From the daily chart, it might appear as triple bottom. However normal triple or double bottom formation followed a certain amount of downtrend. This doesn't apply to NVDA. As mentioned, NVDA has been on a 🐂 run. I have included a weekly chart below. You will find 3 lines, red, orange and green. Instead of head and shoulders, I would suggest a series of tops, the green being the resistance line. Red line is the support, at around 402, while orange line around 304 is the price target for the tops. A gap up formed between 304 and 371 in May 2023. The tendency is to fill this gap and 304 happens to be close to the tops target.
Furthermore, RSI in the weekly chart has been on a downtrend since the tops formed, indicating a divergence. This is further signal that the price of NVDA has peaked in the middle term and will be heading down.
Perfect analysis and future forcast of NVIDIA Corp, now I have a better perseption of NVIDIA’s leadership in its field.
Great ariticle, would you like to share it?
Great ariticle, would you like to share it?
Triple bottom...