Thinking of buying Nvidia (NVDA) tomorrow? Here’s your trade. (May 09, 2017)


Lets look at NVIDIA ( NASDAQ:NVDA ) today. They were in consolidation all the way up until they reported earnings after the bell. Now, the stock is up appreciably higher (to use a million dollar word), over 10 percent, up about 13 percent.

So here is the deal: I think this stock is moving higher. It has been trending higher it seems like forever. Every sideways consolidation turns out to be a break to the upside. After the kind of earnings they reported I don’t pay a lot of attention to this declining volume just because the stock is up so much now. The weekly chart is interesting but it is not really just positive. Even on the daily chart, stocks that trend sideways, they typically do trade at lower volume. So all of this stuff is okay too.

The thing is, and I will say it again, I think NVIDIA ( NASDAQ:NVDA ) is going higher, but I would not buy it tomorrow morning. With the stock trading at basically 116.80, lets call it 117.00, the real resistance level here is just up at 120.00. So why buy it up like 13 percent when it will be just $3.00 below resistance? Frankly, I wish I had mortgaged the house and put everything into this before they reported, that would be gambling. But the thing is, why take a risk that the stock is going to pull back, which it very well could do, but why take a risk that the stock is going to pull back when you could just wait three more dollars? Literally just wait until the stock breaks out above 120.00, and then at least you know everybody is a winner.

Everybody that has ever been long NVIDIA ( NASDAQ:NVDA ) is happy, happy, joy, joy, which means that you are not going to get all this supply. There is not going to be all these unhappy shareholders who are finally able to get their money back. You are not going to get that. Everybody is happy when the stock is at an all-time high. As it is right now, if this is where the stock is trading (we will just draw this), two or three times before, this has been an opportune time to sell. Now we are back up there. Why buy this stock here when you can wait and see if the stock comes here? If it does, that is when you buy the stock.

By the way, if it does pull back and trades to like 110.00, 105.00 would be even better, that is when you really load the boat. Not for a trade but for a long-term hold. They are in the artificial intelligence industry and that seems to be the thing that everybody is looking at. The stock is breaking out; wait for it to get above 120.00.

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