Raymond James said Nvidia’s plunge is hitting some technical milestones, suggesting the stock may continue to slide. Shares of the major artificial intelligence chip maker fell about 8% in July. Raymond James chart analyst Javed Mirza said in a note to clients on July 25 that Nvidia has triggered a “mechanical sell” signal based on the moving average convergence/divergence indicator (MACD) that measures price momentum, and it is not the only one. signal. “Combined with price breaking below an important technical level below the 50-day moving average… and volume showing early signs of selling pressure… these three early technical negatives suggest that a mid-term (1-3 month) correction phase is trying to take place, etc. “The note read. Mirza said the key level to watch is Nvidia’s 50-day moving average, currently around $118 per share. “A multi-day close below important technical support at the 50-day moving average… would confirm that a new short-term correction phase is underway. This would open the door to filling the gap near 94.94… or another 16.9% downside from current levels. level,” the note said. Nvidia is the biggest beneficiary of the artificial intelligence boom. Other technology companies have been spending billions of dollars ordering chips from Nvidia, which is seen as far ahead of its rivals in making high-end semiconductors. The stock is up more than 400% in the past three years. However, investors appear increasingly skeptical of AI’s direct contribution to higher corporate profits, at least in the short term. If this view spreads to senior executives at large technology companies such as Alphabet, it could lead to a slowdown in new orders for Nvidia. Nvidia will announce second-quarter results on August 28.
