NVIDIA closes in on buy levels

NVIDIA was up almost 240% in 2023, continuing the rally even into 2024. The growth trajectory is powered by top-notch financial results and is expected to continue deep into 2024 and beyond.

Trading.biz analyst Rahul Nambiampurath states that the Q3 2023 performance of NVIDIA, with revenue tripling to $18.1 billion, is the primary reason why the rally has extended into 2024.

“The rising demand for AI chips, specifically for training ChatGPT-like models and to bring forth newer innovations, has made NVIDIA (NVDA) even more attractive,” mentions Rahul. Besides the demand for AI chips and the increase in revenue, especially across the data centre and AI segments, there are other reasons for the NVDA sitting at buy levels.

These include:

• High earnings expectations
• Strong buy ratings with analysts projecting levels as high as $1,100 for the stock
• A surge in the valuation of the technology sector, especially the NASDAQ Composite
• Unveiling of the RTX 40 Series cards at CES 2024
• Focus on amplifying the Generative AI performances

Here is the daily chart of NVIDIA signalling key “Buy” levels as of Jan. 15, 2024. The price seems to have broken out of the triangle pattern, with even the Relative Strength Index metric showing a surge in momentum.

The upper trendline of the previous pattern, followed by the 50-day EMA line (black) serves as the immediate support levels.

If the Fibonacci levels are to be considered, NVIDIA’s next stop (s) could be at $549.86 and $580.79 in the short-to-mid term.

The impact on other tech, especially AI stocks

If you want to add more to your AI basket, seeing NVIDIA’s optimistic performance, other options might exist. These include CrowdStrike Holdings (CRWD), up over 145% in 2023, as a major player in cybersecurity, Palantir Technologies (PLTR), which offers AI solutions and surged over 150% in 2023, and more.

Impact on the broader index

The price surges in the tech and AI space have impacted indices like the Nasdaq Composite, which is heavily tech-reliant. As of January 15, 2024, press time, the year-to-date rise stands at 43.21% — higher than what the S&P 500 and Dow Jones Industrial managed.

Zooming in further reveals that the SPDR, or rather the technology Select Sector, is up 54.3% YTD, which marks an optimistic trend for users interested in cloud computing, machine learning, AI, and related stocks.