What This Mystery Pattern Reveals about Trading Nvidia's Shocking Fall from Grace

Dear Reader,

Sometimes the worst time to buy a stock is when its hyped up and everyone is got their eyeballs on it.

Take Nvidia for example...

During its last earnings announcement, EVERYONE was paying attention. And many people piled into the just after the report came out.

Fast forward to today, and the stock's plummeted over 15% from its all-time high a big question mark about its next move.

You might even be looking at its current price and asking yourself... is NVDA a Buy right now with the pullback? Should I wait as it may go lower from here? What do I do?

And that's what I want to talk to you about...

There are roughly five different patterns I look at as a rules-based trader when evaluating buy and sell signals on stocks, exchange-traded funds (ETFs), and even cryptos.

But of the five, there's only one that I haven't shared... until now.

Click on my video below to find out what it is - and how it can help your trading game:

Here's Your Two-Minute Trading Video Recap

In the last 30 days, the price of Nvidia Corporation (NVDA) has dropped from just over $500 per share to just over $400 per share, resulting in a 20% drop in price. And a good portion of that drop happened over the last two weeks alone. Now part of this is due to the pullback in tech and artificial intelligence. But Nvidia caused some of its own damage, too. With a chunk of its revenues coming from just one relationship and potential accounting regularities, there's been some concern among investors that we're seeing in the stock's price action.

So the question is... how the heck do you know what to do from here?

Well, as a rules-based trader, I look for objective signals that the bounce is really happening. And as a trader, I'm just not seeing those right now. BUT, if you're looking at this as an investor - not a trader - let me offer you three things that are bullish about NVDA at current prices:

  1. Volume
  2. Technicals
  3. Price

Let's take a look at the volume chart of NVDA first...

Since the earnings announcement, stock volume has actually dropped with price (meaning that although the price has pulled back, trading volume has as well). What this tells us is that there's no panic volume here - NVDA has actually returned to average trading volume once again. Efficiency in transactional volume is a safety measure on its own.

Next, let's look at the technicals...

If you spread this chart out over a three- to six-month period, you'll see the first-quarter move that pushed NVDA up from $300 to where we are now. The lows are still getting higher - and the highs are, too.

Notice the cone on the chart here, too... This just indicates it's a volatile stock but the next cone move looks to be higher. Additionally, the gap from that $300 to $500 price range makes $400 a 50% retracement from earnings to earnings - a good number to bounce from. There are many other contrarian indicators that confirm this.

Finally - and I don't even need a chart for this - let's talk about price. Right now the stock is down 15 to 20 percent in the last month. That's a HUGE discount from where it was and a great area to start dipping your investment toes in the water.

How much? That's up to you to decide.

How to invest? That's something you're going to have to wait until next week to find out.

But in the meantime, I want to introduce you to someone who's been trading stocks like NVDA with laser-like precision.

He beat the top hedge funds in the country by 15X over the past three years alone.

And just recently, he closed a killer trade that made him a rare 688% in just one day.

Here's what's even more impressive...

For years, he's consistently made money on 8 out 10 trades. That's an almost unheard of 80%-win rate...

And he's grown his account by an incredible 764% in five years.

The man is absolutely UNBEATABLE!

Click here to meet him - and exactly how he did it.

We'll talk again soon...

Tom

The post What This Mystery Pattern Reveals about Trading Nvidia's Shocking Fall from Grace appeared first on Power Profit Trades.

About the Author

Tom Gentile, options trading specialist for Money Map Press, is widely known as America's No. 1 Pattern Trader thanks to his nearly 30 years of experience spotting lucrative patterns in options trading. Tom has taught over 300,000 traders his option trading secrets in a variety of settings, including seminars and workshops. He's also a bestselling author of eight books and training courses.

Read full bio