Nvidia Shares: What to Expect from the Earnings Report
Nvidia (NVDA) shares are in the spotlight this week as the artificial intelligence (AI) favorite prepares to release its highly anticipated earnings report for its fiscal 2025 second quarter on Wednesday. Investors are eagerly looking out for sustained growth in the chipmaker’s data center segment and updates about its next-generation Blackwell chips following reported delays.
The AI darling’s shares have surged around 43% from their August low, driven by bullish Wall Street coverage and growing earnings forecasts. Nvidia has consistently exceeded expectations for both revenue and earnings in recent quarters, and investors are hoping for another blockbuster report.
Technical Analysis: Rectangle Formation Indicates Upside Continuation
Since staging an intraday reversal in early August to mark the end of a 26% correction from their record closing high, Nvidia shares have recovered the majority of those losses. The price recently consolidated within a rectangle formation, indicating a continuation of the chipmaker’s move higher.
However, trading volumes during the stock’s resurgence remain below longer-term averages, suggesting possible apprehension by institutional investors ahead of the company’s quarterly results. Despite this, the stock gained 4.6% on Friday to close at $129.37.
Support Levels to Watch
In the event of a breakdown below the rectangle pattern, the shares could initially test the $116 level. This area on the chart, in close vicinity to the 50-day moving average, could serve as a potential entry point for buyers near a horizontal trendline connecting a series of similar trading levels between May and July.
A deeper post-earnings retracement could lead to a fall to $97, where the shares would likely attract significant support from two prominent price peaks that formed on the chart during March. This region also sits just above the stock’s correction low recorded during the early August broad-based market sell-off.
Resistance Areas to Monitor
Upon an upside breakout of the rectangle formation, the shares may encounter resistance around $136. This level could see investors locking in profits near the June 18 record close, which also aligns with the stock’s July peak.
To forecast a potential resistance area above Nvidia’s all-time high (ATH), we can use the measuring principle. By calculating the distance of the trending move that preceded the rectangle and adding that amount to the formation’s breakout point, we can project a target of $170. This is a location where the shares may face selling pressure.
Conclusion
Investors are eagerly awaiting Nvidia’s earnings report to see if the chipmaker can continue its impressive growth. The company’s shares have already surged 43% from their August low, driven by bullish Wall Street coverage and growing earnings forecasts.
From a technical analysis perspective, the stock’s recent consolidation within a rectangle formation suggests a continuation of its upward trajectory. However, trading volumes during this period have been lower than average, indicating possible caution from institutional investors.
Investors should closely watch support levels around $116 and $97, as well as resistance levels near $136 and $170. These key price levels will provide important insights into the stock’s future movement.
Disclaimer: The comments, opinions, and analyses expressed in this article are for informational purposes only. The author does not own any of the securities mentioned.
