Nvidia (NVDA) Major Breakdown, Technical Analysis Signals This Target

Nvidia (NVDA) Major Breakdown, Technical Analysis Signals This Target

Published At: Feb 01, 2025 by Gareth Soloway
Nvidia (NVDA) Major Breakdown, Technical Analysis Signals This Target

Nvidia (NVDA) shares plunged over 15% last week following the unveiling of DeepSeek, a Chinese AI model capable of running on significantly less expensive hardware. This development casts doubt on the anticipated surge in demand for Nvidia's high-priced chips.

The price drop breached a critical support trendline that had been in place since January 2024, connecting all major subsequent lows. This breach represents significant technical damage to Nvidia's chart.

Since breaking down, Nvidia's stock has struggled to mount a meaningful rebound and has entered a period of sideways consolidation. This pattern resembles a "bear flag" formation, a bearish technical indicator suggesting further downside potential.

If the bear flag pattern confirms, Nvidia's stock is likely to retest the August 2024 lows around $95.50. This level will serve as the first major support test and a crucial indicator of whether buyers can stem further declines.

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