Here’s my take on N(o)vidia ($NVDA) – August 11, 2023
This is Dan Fitzpatrick with your Chart of the Day. NVIDIA ( NASDAQ: NVDA ), I have been talking about this for a while because it’s been important.
All of these other stocks that I have also been mentioning, this is nothing new, Apple ( NASDAQ: AAPL ) is down. NVIDIA ( NASDAQ: NVDA ), that’s one that I am looking at today, it’s down. Meta ( NASDAQ: META ) is almost coming down.
Amazon ( NASDAQ: AMZN ) is down, it is still holding up okay but it hasn’t continued its rally. Apple ( NASDAQ: AAPL ), is again down. Microsoft ( NASDAQ: MSFT ) is down. Tesla ( NASDAQ: TSLA ) is down. So it’s like all of the Mega-Cap stocks are falling, shall we say, from the sky.
As I look at NVIDIA ( NASDAQ: NVDA ), I see this as a little bit like “The Last of the Mohicans”, maybe Meta ( NASDAQ: META ). But as I mentioned the other day, when I was on Fox Business with Charles Payne, I said I would sell Apple ( NASDAQ: AAPL ) and Microsoft ( NASDAQ: MSFT ) and probably hold NVIDIA ( NASDAQ: NVDA ), etcetera, etcetera.
I am amending that, I would sell this, I would sell the living hell out of this thing ( NASDAQ: NVDA ) because it is falling. It is through a key moving average, it’s had a heck of a run. They have earnings next week, on the 23rd, actually the week after that. And this is what I am looking at, I think this is going to continue to fall. It will not fall here, it’s a great stock but I know they are having supply issues and stuff like that.
But my sense is, let’s say they report great numbers. Again, this is a pretty nasty bunch of resistance here, a lot of resistance. And so, it makes the stock really heavy. And when the stock is really heavy like this, then any rally up into this area is more than likely going to be sold into.
So my suggestion is, just stay away from it. If you want to take a shot, that’s fine. You could say, Well, Fitzpatrick doesn’t know what he’s talking about. I don’t because it’s in the future, so I will acknowledge that I have no idea what the stock is going to do in reaction to earnings.
But what I do have a pretty good opinion on is, if the stock rallies it is not going to blow out here. It would rally up and likely be sold into. So what you should really be doing is, if you want to hang on over earnings know that this is the best scenario. Your worst-case scenario is right down here.
So I will let you decide whether you want to make that trade or not. But in my mind, it is not a trade that I am going to make. In fact, truth be told, we are short NVIDIA ( NASDAQ: NVDA ) over at Option Market Mentor.
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