🐉 Deep Dive: Why the Return of the Dragon is NVDA’s Next Rocket Fuel 🚀

The headlines are flashing, and the after-hours market is moving. Trump has officially given the green light for Nvidia ($NVDA) to resume selling its H200 AI chips to China, subject to a 25% tariff.

At first glance, some investors might worry about the tariff. But if you look deeper, this is arguably the most bullish signal we have received for Nvidia in months. We are currently sitting at $184.29, and I believe this news is the catalyst that finally ends the recent correction.

Here is my full analysis on why the "China Unlock" changes everything. 👇

1. The Myth of the "Tariff Problem" 🛑➡️🟢

The Bears will argue that a 25% tariff makes Nvidia chips too expensive for Chinese buyers. This is a fundamental misunderstanding of the AI market.

We are dealing with Inelastic Demand.

Chinese tech giants—Alibaba, Tencent, ByteDance—are currently locked in an existential arms race for AI dominance. To compete with US models like GPT-4 and Gemini, they need the best compute power available. They cannot afford to lose ground while waiting for domestic alternatives to catch up.

* The Reality: These companies are sitting on billions in cash. They do not care about a 25% premium. They care about access.

* The Result: The buyer pays the tariff. Nvidia’s profit margins remain protected, while their volume—which was artificially capped by the ban—is allowed to expand again.

2. Removing the "Geopolitical Discount" 📉

For the last six months, Nvidia's stock price has been weighed down by a "Geopolitical Discount." Institutional investors have been hesitant to go all-in because of the fear that the US government would cut off all China sales completely.

Trump’s announcement provides the one thing markets love most: Certainty.

We now know the rules of the game. We are moving from a "Ban" strategy to a "Tax" strategy. This removes the "Doomsday Scenario" from the table. When you remove the worst-case scenario, the valuation multiple naturally expands.

3. The "Found Money" in Revenue 💰

Let’s look at the numbers. Historically, China accounted for roughly 20-25% of Nvidia’s Data Center revenue. When the bans hit, that number didn't go to zero, but it dropped significantly as Nvidia scrambled to make compliant chips (like the H20).

The H200 is a beast of a chip. If Nvidia can recapture even 50% of its previous China market share with the H200, we are looking at billions of dollars in "found revenue" that analysts likely haven't baked into their 2026 models yet. This sets us up for a massive "beat and raise" in upcoming earnings calls.

4. Technical Analysis: The Breakout Setup 📊

Looking at the charts, the timing of this news is perfect.

* Current Price: ~$184.29.

* The Resistance: We have been stuck under the $185 ceiling for a while. Every time we get close, we sell off.

* The Catalyst: This news provides the volume and sentiment shift needed to punch through that ceiling.

If $NVDA can close a daily candle above $185, the technical structure changes from "Consolidation" to "Breakout." The next major resistance isn't until the psychological $200 level. On the downside, we have established a very strong floor of support around $167, giving us an excellent Risk/Reward ratio at these levels.

🦁 My Verdict

The "Dragon" is awake. The resumption of H200 sales turns a headwind into a tailwind. The demand is there, the product is superior, and now the regulatory door is open.

I am treating the current price of $184.29 as a gift. The decline ends here.

What is your move?

Are you worried about the 25% tariff, or do you agree that China will pay whatever it takes? Let’s discuss in the comments! 👇

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