Trading Strategies For Nvidia Stock Before And After Q3 Earnings

NVIDIA Corporation NVDA was trading lower Wednesday as the company heads into its third-quarter 2023 earnings print after the close.

When Nvidia printed a second-quarter earnings miss on Aug. 24, the stock opened lower the following day but ran into a group of buyers who caused the stock to soar up over 6% off the open. Nvidia then fell through the neckline of a head-and-shoulders pattern and entered into a downtrend, which brought it to a 52-week low of $108.13 on Oct. 13.

For the second quarter, Nvidia reported earnings per share of 51 cents on revenues of $6.7 billion, missing a consensus estimate of EPS of $1.25 on revenues of $8.1 billion.

For the third quarter, analysts, on average, estimate Nvidia will report earnings per share of 69 cents on revenues of $5.77 billion. Traders and investors will also be paying attention to how Nvidia guides its earnings for the next quarter and whether it sees an impending improvement in the supply chain.

Ahead of the print, Credit Suisse analyst Chris Caso assumed coverage on Nvidia and announced a price target of $210.

From a technical analysis perspective, Nvidia’s stock looks neutral heading into the event.

It should be noted that holding stocks or options over an earnings print is akin to gambling because stocks can react bullishly to an earnings miss and bearishly to an earnings beat.

See Also: Nvidia Stock Is Sliding Today: What's Going On?

The Nvidia Chart: Nvidia has skyrocketed almost 50% since reversing into an uptrend on Oct. 13. The stock’s most recent higher high was formed on Tuesday at $169.98 and the most recent confirmed higher low was printed at the $137.59 mark on Nov. 9.

• On Wednesday, Nvidia was working to print a doji candlestick on the daily chart, which indicates a reversal to the upside may be in the cards and the low-of-day may serve as the next higher low within the pattern.
• If Nvidia receives a positive reaction to its earnings print and surges higher, bullish traders will want to see if the stock can reclaim the 200-day simple moving average (SMA).
• If Nvidia is able to reach the 200-day SMA but not pop above the level, bearish traders will want to see the stock print a bearish reversal candlestick, such as a doji or shooting star candlestick, under the area. If Nvidia suffers a bearish reaction to its earnings print, and loses the eight-day exponential moving average as support, the stock could negate its current uptrend.
• Nvidia has resistance above at $180.73 and $187.80 and support below at $161.37 and $145.75.

See Also: Nvidia Stock Could Be Swept Away On Q3 Earnings As Technical Storm Casts Shadow On Semiconductor Names 

Photo courtesy of Nvidia.