Key Takeaways
\nNvidia shares hovered near their all-time highs Friday after setting a string of records this week on optimism about artificial intelligence demand.The shares recently broke out from a flag pattern on Thursday, signaling potential upside above the stock\u2019s recent trading range.The measured move technique forecasts a price target of $204, while bars pattern analysis projects a potential move up to $255.Investors should watch major support levels on Nvidia’s chart around $184 and $165.<\/p>\n
Nvidia (NVDA<\/a>) shares hovered near their all-time highs Friday after setting a string of records earlier this week on optimism about the artificial intelligence<\/a> trade.\n<\/p>\n The AI chipmaker’s stock climbed nearly 2% Friday to a fresh intraday high before pulling back in recent trading, after setting closing records Thursday and Wednesday. CEO Jensen Huang<\/a> told CNBC Wednesday that AI demand has grown “substantially” in the last six months, and that he believes the AI boom is still in its early stages, leaving further room for growth. Sentiment for the stock also got a boost as Nvidia supplier TSMC (TSM<\/a>) on Thursday posted a 30% year-over-year jump in third-quarter revenue.\n<\/p>\n Nvidia shares have surged nearly 40% since the start of the year, powering broader stock market gains and sending the company\u2019s market value above $4 trillion<\/a>, making it the first company in the world to achieve that feat. The stock continues to attract buying interest as its big tech customers spend billions to ramp up their AI capacity<\/a>.\n<\/p>\n Below, we take a closer look at the technicals on Nvidia\u2019s chart and identify major price levels worth watching out for.\n<\/p>\n Flag Pattern Breakout <\/p>\n Nvidia shares broke out from a flag<\/a> pattern on Thursday, signaling potential upside above the stock\u2019s recent trading range<\/a>.\n<\/p>\n Meanwhile, the relative strength index<\/a> confirms bullish momentum. The indicator also sits well below its June and July peaks, suggesting the stock has further room to trend upwards. Looking ahead, investors could watch for rising trading volume<\/a>, which would point to institutional<\/a> accumulation of the chipmaker’s stock.\n<\/p>\n Let\u2019s apply technical analysis<\/a> to Nvidia\u2019s chart to arrive at two possible upside price targets<\/a> worth watching, and also identify several major support levels<\/a> to monitor during future retracements.\n<\/p>\n Measured Move Price Target <\/p>\n To project a price target using the measured move technique, investors would calculate the distance between the recent trading range\u2019s two trendlines<\/a> and add that amount to the pattern\u2019s top trendline. In this case, we could add $20 to $184, which would produce a target of $204, about 6% above Thursday\u2019s closing price.\n<\/p>\n Bars Pattern Analysis Price Target <\/p>\n Investors can also arrive at a higher price target using bars pattern analysis. When applying this to Nvidia\u2019s chart, we extract the price bars comprising the stock\u2019s strong uptrend from May to July and reposition them from the flag pattern\u2019s breakout<\/a> point. This generates a target of around $255, a move that implies 32% upside from yesterday\u2019s close. We selected this prior trend as it followed an earlier comparable flag on the chart, possibly offering clues as to how a new move higher could take shape.\n<\/p>\n Major Support Levels to Monitor <\/p>\n During retracements in the stock, investors should keep tabs on the $184 level. Nvidia bulls would likely defend this location near the trading range\u2019s upper trendline, potentially turning it from prior resistance<\/a> into future support.\n<\/p>\n Selling below this major level opens the door for a rest of lower support around $165. Investors could seek entry points<\/a> in this region near several lows that formed on the chart in July and September, which also mark the trading range’s lower trendline.\n<\/p>\n