It’s been an ugly stretch for the stock market, but it may be time to start looking for some opportunities in high-quality holdings.
It’s a high-quality, high-margin, high-growth company that caters to multiple end-markets that boast secular growth.
In this type of climate — where the S&P 500 is in correction territory and the Nasdaq is down 18.6% from the high — it can be hard to be a buyer. It may very well prove to be too early to buy, too.
Last week alone, the S&P 500’s best session was a 0.97% loss. I think that helps put things in perspective a bit.
When we look at Nvidia though, we’re talking about a stock that was hitting new all-time highs in November, but is now down almost 40% from the highs.
Trading Nvidia Stock
Nvidia stock is working on its fifth straight down week and its ninth weekly loss in the last 10 weeks.
Granted, it’s only Monday and it’s a long week. So Nvidia could close the week higher, but that doesn’t change the fact that this high-quality holding is down considerably over the last few months.
At today’s low, Nvidia shares were down 38.5% from the highs and giving bulls the first test of the 200-day moving average since March 2021.
If Nvidia can’t find its footing around the 200-day moving average (having already cut below the weekly VWAP measure), there is another layer of support just below current levels.
Specifically, I am watching the 50-week moving average currently near $208, followed by the fourth-quarter low at $195.55.
The $200 area was also notable, in that it was resistance in the second and third quarters, but support in the fourth quarter.
Is it possible for Nvidia stock to fully break down and trade significantly lower?
Of course! If the stock market goes into a full-blown roaring bear market, then Nvidia is going lower. There’s no other way to look at it.
However, for those that have been itching for a position in this name and felt like they missed Nvidia stock a few months ago, here’s an opportunity. Shares are down between 38% and 44% and into some notable areas of potential support, offering longer-term bulls a chance to nibble.