Technical Analysis: Why Nvidia Stock Looks Like It's Reversing

NVIDIA Corp. NVDA shares were trading higher Tuesday ahead of the company's fourth-quarter report on Wednesday. 

The consensus estimate is for the company to report earnings of $1.22 per share.

Nvidia was up 8.13% at $262.41 Tuesday afternoon. 

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Nvidia Daily Chart Analysis

• The stock recently saw a bounce off support and has been trending higher in recent weeks. The stock was able to bounce off the $210 support level once again and has been pushing higher since.
• The stock trades below the 50-day moving average (green) but trades above the 200-day moving average (blue), indicating the stock is in a period of consolidation. The 50-day moving average may act as a place of resistance, while the 200-day moving averages may hold as support.
• The Relative Strength Index (RSI) has been climbing over the last couple weeks and now sits at 52. The cross above the middle line shows the stock is now seeing more buying pressure than it is selling pressure. This is a sign the stock is attempting to make a reversal.

What’s Next For Nvidia?

The stock was seeing a period of downward movement for the last couple of months but after bouncing off support it looks as though it could start to form an upward trend.

Bullish traders are looking to see the higher lows continue to form. Bulls then want to see the stock cross back above the 50-day moving average for the sentiment to turn bullish once again.

Bearish traders are looking to see the stock start to dip lower and break below the 200-day moving average and the $210 support level. This could potentially cause a strong bearish drop in the future.