Nvidia stock triggers early entries as shares move toward official buy points
Nvidia ( NVDA ) stock had quite a bullish week as shares barreled toward consolidation buy points with weekly gains of more than 7%. The stock has rallied in recent weeks after company executives said its new Blackwell chip was sold out for the next 12 months.
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The earnings of this leading chip stock could be a barometer for the strength of AI spending
Earlier this week, reports said that Apple iPhone maker Foxconn plans to increase server capacity to meet “insane” demand for Nvidia's Blackwell chips. The news sent shares up nearly 4% on Tuesday. In addition, chipmakers Taiwan Semiconductor (TSM) helped boost Nvidia shares with strong third-quarter sales, reported early Wednesday.
Currently, Nvidia stock trades just 4% below the 140.76 correct buy point from the consolidation. This level represents his split-matched, all-time high.
The stock is still active after it broke above the recent horizontal resistance level at 131.26. Savvy investors can use a downward sloping trendline within the current base to buy the stock as it moved above the line on Monday.
Investors should note that the stock is currently up 14% from its 50-day moving average. When stocks are overextended, the risk of a pullback is high. However, while not at brand new highs, relative strength lines are near highs, a sure sign of strength.
Nvidia Stock: Second Quarter Earnings
Nvidia has long been a pioneer in graphics processors used in industries such as healthcare, automobiles and robotics. But in March 2023, OpenAI's ChatGPT made a huge technological breakthrough with generative artificial intelligence.
And according to CEO Jensen Huang, Nvidia's AI-enabled supercomputer has paved the way for “AI's iPhone moment.”
This helped the company to increase its revenue. Nvidia has achieved record top- and bottom-line growth in the most recent five quarters.
In the most recent quarter, Nvidia's earnings beat Wall Street expectations. Meanwhile, sales of $30.04 billion exceeded analysts' expectations of $28.7 billion. Revenue has also grown by 122% year-on-year.
Nvidia stock's earnings of 68 cents per share also came in above analysts' estimates of 65 cents. Which is 152% more than the previous year. The firm guided higher for the current quarter with sales of $31.7 billion vs. a view of $32.5 billion.
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