Nvidia's (NVDA, Financial) shares tumbled more than 4% on Monday, hitting the lowest since February 10, while investors rushed to embrace cyclicals, the Dow Jones Industrial Average hitting a record high. It is a return to the downward trend from August, and the shares could not stay above the critical $141 support level. Analysts have pointed out that one might be achieved as the stock reaches the areas near the $136-$134 support levels. Another signal was a Demark indicator that allowed determining the presence of bearish price exhaustion, which signaled a short-term decline.
However, The Current selloff can be attributed to a larger market phenomenon, where people are dumping growth stocks like Nvidia and investing in more cyclical businesses due to a perceived 'better' economy ahead. On the other hand, fundamentals such as NVIDIA's status as a leader in providing solutions for artificial intelligence make me believe its long-term trajectory remains bulletproof.
Still, Nvidia has solid long-term performance, as it rose 187% year to date and 197% over the last 12 months. This has continued to be a key strength in the company's growth, especially within the AI sector, though in the short run, prices will be volatile in line with market trends.
