Nvidia Stock Drops and Approaches Key Technical Levels Amid Tech Sell-Off

Investors are continuing to offload Nvidia stock, causing the chipmaker's shares to drop by 4% on Friday. The stock is poised to finish the week down by 14% following news of an antitrust investigation. At present, Nvidia's stock price is hovering around $100 per share, a critical technical milestone closely monitored by analysts.

Post-Earnings Decline

Nvidia's stock price experienced a further decline on Friday, as shares flirted with a significant technical level amidst a broader sell-off in the tech sector. The chipmaker's shares fell by over 4.5% to trade at approximately $102.15 per share. This places the stock in proximity to both a key psychological threshold of $100 per share and its 200-day moving average, situated just below $90.

Analyst Outlook

Traders are closely observing these levels for indications that Nvidia's impressive rally may be losing momentum, as noted by analysts speaking to Business Insider. Despite this, Wall Street analysts generally maintain a positive outlook on the stock, with an average price target of $153 per share projected, according to Nasdaq data.

Antitrust Probe Impact

Investor sentiment towards Nvidia has been cautious following the release of the company's second-quarter financial results, which surpassed earnings estimates but fell short of the highest expectations. Although the stock showed a slight recovery earlier in the week, it resumed its sharp decline after reports emerged from Bloomberg regarding a Department of Justice antitrust investigation.

Bank of America strategists emphasized the ongoing government investigations against major US tech firms in recent years, stating that until more details emerge, they anticipate no significant impact on Nvidia's fundamental prospects. They reiterated their "buy" rating on the stock.

Market Value and Performance

Nvidia has witnessed a decrease of approximately $500 million in market value since early June, with the company's market capitalization standing at $2.53 trillion on Friday. Despite the weekly decline of 14%, the stock remains 111% higher than its levels at the beginning of the year.

Market Trends and Economic Concerns

Friday's downturn coincided with a broader tech slump, with the Nasdaq Composite index dropping by 2.5% by 2:00 p.m. ET. Heightened by weaker-than-expected data from the August jobs report, investors have been shedding high-growth tech stocks, raising concerns about a potential economic slowdown.

For more information, you can refer to the original article on Business Insider.

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By: jsor@businessinsider.com (Jennifer Sor)
Title: Nvidia Stock Drops and Approaches Key Technical Levels Amid Tech Sell-Off
Sourced From: markets.businessinsider.com/news/stocks/nvidia-stock-price-prediction-technical-analysis-outlook-doj-antitrust-probe-2024-9
Published Date: Fri, 06 Sep 2024 18:08:55 +0000