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NVIDIA Corp NVDA declined over 3% when the market opened Thursday before spiking up over 3.4% from Wednesday’s closing price.
The move came in tandem with the general market, which saw the S&P 500 whipsawing back and forth around the 200-day simple moving average (SMA) as the market attempted to digest CPI data released by the U.S. Labor Department.
Nvidia tagged the 200-day SMA on Thursday afternoon and was attempting to regain the level as support.
See Also: Boom! Tesla Confirms Bearish Candlestick Pattern — Is A Bull Trap Next?
The 200-day SMA is an important bellwether. Technical traders and investors consider a stock trading above the level on the daily chart to be in a bull cycle, whereas a stock trading under the 200-day SMA is considered to be in a bear cycle.
The 50-day SMA also plays an important role in technical analysis, especially when paired with the 200-day. When the 50-day SMA crosses below the 200-day SMA, a death cross occurs whereas when the 50-day SMA crosses above the 200-day, a bullish golden cross takes place.
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The Nvidia Chart: Nvidia reversed into an uptrend on Dec. 28, with the most recent higher low formed on Jan. 6 at $140.34 and the most recent confirmed higher high printed at the $150.66 mark on Monday. On Thursday, Nvidia was popping higher but hasn’t indicated that the next higher has occurred.
- Thursday’s spike higher was also due to a bullish break from a double inside bar. The inside bar was formed between Monday and Wednesday, with the mother bar printed on Monday and the inside bars formed over the last two trading days.
- If the Santa Clara, California-based company closes the trading session at the 200-day SMA, the stock will print a bearish hanging man candlestick, which could indicate the next higher high is in and Nvidia will trade lower on Friday. If the stock closes the trading day above the 200-day SMA, while still printing a hanging man candlestick, Nvidia may begin to consolidate above the 200-day SMA over the next few days.
- Nivida has resistance above at $169.98 and $180.73 and support below at $161.37 and $145.75.
Read Next: What’s Going On With Nvidia, AMD Shares Today?
Image: Wikimedia
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Image and article originally from www.benzinga.com. Read the original article here.