Lower Nvidia Price Target in Play After Toyota, Uber Announcement Surge
The AI giant enjoyed an exciting CES but the stock price may soon lose a pivot.
You're reading 0 of 1 free page.
Register to read more or Unlock Pro — 50% Off Ends Soon
Tuesday morning. Not too far into the regular trading session. Nvidia NVDA ran quite the show last night from CES 2025, unveiling a number of new products and exciting high-end technologies, as well putting together some collaborative deals with both established corporations like Toyota Motors TM and Uber Technologies UBER as well as upstarts such as Aurora Innovation AUR and Arbe Robotics ARBE.
Of course, CEO Jensen Huang, who I love to refer to as "The Fonz" due to his permanently-worn leather jacket and his cool ability to upsell, led the way at the center of attention.
Now, for some seriousness. Readers will recall that I wrote to you just this past Friday concerning Nvidia. I told you that, outside of my long position (which ain't what it used to be), I was putting on a "Jensen" trade. When I wrote that piece on Friday, Nvidia was trading at $139.90. I told you that this short-term trade was just for the Huang keynote. NVDA traded as high as $153.13 on Tuesday morning. The last sale I see bears a $145 handle. Hopefully, if any readers did follow me into that trade, they are either back to flat or back to their core position at this point. If not, that's a lesson learned, which is to stick to one's objectives.
The Why...
Civil War buffs among the readership may recall the "leadership" exhibited by New York politician-turned-general Dan Sickles at Gettysburg. In command of the 3rd Corps of the Army of the Potomac, Sickles saw clear ground ahead of his position and ordered his troops to move out and take that ground despite the fact that the 3rd Corps would become detached from the rest of the army on Cemetery Ridge to the north and Little Round Top to the south.
Well, you guessed it, Sickles' Corps was smashed by Longstreet's Corps of the Army of Northern Virginia while they were exposed, and the day was nearly lost for the entire army under George Meade's command. What Sickles had done was offer an undersized Confederate Army an opportunity and they darned near rolled up the whole of the Army of the Potomac on that second day of that battle.
If not for the willing sacrifice of the 1st Minnesota Infantry and the stand made to the south by the 20th Maine Infantry, General Robert E. Lee might never have made the blunder on day three at Gettysburg (Pickett's charge) that the Confederacy really never recovered from. That's what not sticking to a plan does. I see NVDA now trading with a $142 handle. That was quick.
New Charts
Readers would recall that I had written that NVDA had to retake the 50-day SMA and establish itself above $153 in order for me to feel good about a $161 target. The shares did manage a quick kiss at $153, but certainly did not establish themselves. Now, the worry is the loss of the 50-day SMA, as that will force portfolio managers to reduce long-side exposure.
Relative strength is coming off quickly as the daily MACD looks like a mosh pit of colors and lines. Yes, technically the MACD is still bullish, but just by a smidgen. Until the 50-day line cracks, my target is still $161, but I stand ready to reduce my core long further than I already have. Check this out...
Remember the head-and-shoulders pattern that I showed you, which is bearish, but failed? Well, there's a new kid in town, and he isn't any more bullish....
That's called a double-top reversal pattern, and this one bears a downside pivot of $127. What does that mean? Now, all of these things won't necessarily happen, but if the stock cedes the 50-day SMA and then loses the pivot? Then a target price below $110 would not be ridiculous.
At the time of publication, Guilfoyle was long NVDA equity.
