📈 NVDA Bubble Popped?

Is NVDA's recent weakness cause for concern?

NVDA Pullback

Over the past few days we have seen a significant pullback in the market’s leading stock NVDA.

The stock has dropped from $140 to $117 in three trading days, closing at the low of the day yesterday.

Goldman Sachs told us that so goes NVDA, so goes the market. So should we be concerned? Let’s take a look at what has transpired with the stock.

NVDA Analysis

NVDA has posted three straight days of selling, as shown below:

The bars that you are seeing are extremely weak, closing at lows of the day and slicing through moving averages like butter.

You essentially have a three black crows pattern - which is bearish and predicts further weakness.

Right now if you are trading NVDA - and frankly any tech stock at the moment - you should be treating them as day trades with the potential to hold overnight if you are up in them.

I would not be holding any new positions that you are down in overnight. These stocks have potential to gap down on you so it is probably best to come into each new day fresh.

You can see from the image above that we tried a day trade at the end of the day yesterday in NVDA after it held the low of the day.

The stock reversed and closed at a low so we closed the position. This is how I would be trading right now - find setups you are comfortable with, and if they don’t work, blow them out.

Honor your stops. The skew has changed and we are in a volatile market. Don’t get chopped up.