Nvidia stock, though being of the leaders in the chip and AI markets, is making a strong possible short opportunity.
When we look at the Weekly chart, we see a nice Head and Shoulders formation in the making. Points to consider if taking this opportunity:
1. I will be waiting for NVDA to drop below $400 mark, to be more precise, $398. I need this down pump for the entry to be valid.
2. When the play starts, I will set my SL close to $411 level. Why there you may ask? If the drop in price happens, $411 will be the level where 10EMA will be on the Daily time frame, and since this will be a short sell, I don't want to give the market the opportunity to test the higher part of the Neckline. The Neckline of the Head and Shoulders will be my exit point, if the price breaks above the neckline, I will most likely be closing the trade manually.
3. For the TP level, I am looking at couple of possibilities. First one, is the entire length from the Head to the Neckline which is in range of some $100 price movement. The second possibility, the more conservative one, will be the previous Higher High of the movement, sitting around $346.61 price level which is also where the 200EMA is currently at. The third one, is of course the 200EMA itself. As the price keeps moving, it will move as well, and if there is no strong market movement and price makes the second guess on whether or not it will go down, the 200EMA will be my "get out quick" point.
Of course, as always, this is no financial advice. This is just my humble opinion.
When we look at the Weekly chart, we see a nice Head and Shoulders formation in the making. Points to consider if taking this opportunity:
1. I will be waiting for NVDA to drop below $400 mark, to be more precise, $398. I need this down pump for the entry to be valid.
2. When the play starts, I will set my SL close to $411 level. Why there you may ask? If the drop in price happens, $411 will be the level where 10EMA will be on the Daily time frame, and since this will be a short sell, I don't want to give the market the opportunity to test the higher part of the Neckline. The Neckline of the Head and Shoulders will be my exit point, if the price breaks above the neckline, I will most likely be closing the trade manually.
3. For the TP level, I am looking at couple of possibilities. First one, is the entire length from the Head to the Neckline which is in range of some $100 price movement. The second possibility, the more conservative one, will be the previous Higher High of the movement, sitting around $346.61 price level which is also where the 200EMA is currently at. The third one, is of course the 200EMA itself. As the price keeps moving, it will move as well, and if there is no strong market movement and price makes the second guess on whether or not it will go down, the 200EMA will be my "get out quick" point.
Of course, as always, this is no financial advice. This is just my humble opinion.