Nvidia Slips Despite Earnings Beat, Strong Guidance

Nvidia (NVDA) is slipping about -1.7% to the 179 level in early trading, despite the computer chip maker beating earnings on the top and bottom line in yesterday’s postmarket session. 

The company reported adjusted earnings per share of $1.05 against estimates of $1.01, and $46.74B for revenue versus the Street’s estimate of $46.06B, additionally giving strong guidance that projected sales growth will remain above 50% for the next quarter. 

Few companies can boast of a track record like Nvidia has shown in recent years, with yesterday marking the ninth consecutive quarter that year-over-year revenue exceeded 50%. Yesterday’s earnings unleashed a flurry of analyst price target hikes, including from Goldman Sachs, Citigroup, JP Morgan, Bank of America, Oppenheimer, and many more. 

However, this quarter was the slowest time of growth since the A.I. boom took hold of the markets in mid-2023 and data center revenue came in light for the second quarter in a row.

An examination of the chart shows that price has faltered at an important area of prior resistance, which is where price repeatedly got stuck between 180 to 185 near the all-time highs. 

The yearly Volume Profile study also shows a volume node at this general area near 180, signifying a heavy trading area that could once again be a potential congestion point. 

Downside support could be found at the 21-day Exponential Moving Average, which is just below 178, and the yearly +1 Standard Deviation Channel at about 175.50. 

Volume Profile shows that trading activity dries up below the 170 level until about 165, which also lines up with the 63-EMA as well as the opening of a gap from Jul. 14 and the relative lows from Jul. 22, so this could be another key area to watch. 

Going forward, the options market suggests the Sept. 19 monthly expiration could have a move of about +/- $18, which is a little over 10%.