Nvidia (NVDA) – Get Report continues to churn out the gains, as it blasted to a new all-time high on Monday.
The company reported earnings last week, beating analysts’ expectations and providing a solid forward outlook.
It’s just what the company does best. Even though estimates continue to climb, Nvidia continues to beat consensus expectations.
Earlier this year, the company provided better-than-expected guidance. hen in May, raised that outlook once more before announcing a stock split.
After reporting earnings in May, the stock stagnated despite strong results. Then the stock exploded to new highs.
I only mention this because we saw the same thing this time around. Better-than-expected results were met with a shoulder shrug from the market. A few days later though and here we are at new highs.
So how do we navigate Nvidia from here? Let’s look at the chart.
Trading Nvidia Stock
Daily chart of Nvidia stock.
Chart courtesy of TrendSpider.com
TheStreet RecommendsPRESS RELEASESBooming Construction Sector Fueling NDT And Inspection Market Growth Globally, Says P&S Intelligence19 minutes agoPRESS RELEASESDigital Underground Co-Founder Chopmaster J Snubbed By Former Bandmates In Oakland's DU Day Proclamation48 minutes agoPRESS RELEASESInsurtech Carrot Reaches Strategic Collaboration With Korea Expressway Corporation48 minutes ago
Nvidia hit an all-time high of $208.75 in early July before giving investors a relatively quick pullback to the 50-day moving average.
The ensuing bounce nearly sent shares to fresh all-time highs, but Nvidia stock couldn’t do it. Instead, shares pulled back to the 50-day moving average ahead of earnings.
After a day of gyrating up and down, the stock finally gave bulls the upside follow-through they were looking for. Now at new highs, just how far can this name rally?
I’m looking for Nvidia to climb to the 161.8% extension, near $227. Should the stock clear that mark, investors can set their long-term target near the $250 to $255 zone, with the 261.8% extension coming into play near the latter part of that zone.
While that’s admittedly a good distance away, Nvidia has proven that it can justify its expensive valuation. Further, it’s one of the few large-cap tech stocks that seems to have lasting momentum.
On the downside, stay focused on pullbacks to the 10-day moving average. For now, those may be buying opportunities provided the overall market remains stable and Nvidia continues to trend higher.
On a larger dip, I’d love to see the $205 to $208 area act as support. To see prior resistance turn to support would bode well for the bulls. For now, we continue to buy the pullbacks and ride the trend higher.
Nvidia is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells NVDA? Learn more now.