NVIDIA Analysis: Attempted Rising Wedge Breakout Amid Pressure on the AI Sector

Nvidia’s short-term fundamental backdrop has deteriorated. On 14 September, the company’s shares fell 3.4% amid a sell-off in AI-related stocks driven by concerns over a potential slowdown in the pace of artificial intelligence development. However, Nvidia’s business outlook remains strong, with the company forecasting revenue growth of around 70% in fiscal 2028. An additional risk factor is a US Department of Justice investigation into Nvidia’s $17 billion agreement with Groq over potential attempts to circumvent antitrust oversight.

NVIDIA Technical Analysis

On the NVDA four-hour chart, a corrective phase developed following a pronounced uptrend. After the correction ended, the price resumed its advance and formed a pattern resembling a rising wedge. The price subsequently broke below not only the wedge but also the current profile boundary around $220.00 and is now attempting to establish itself below this level. If the price manages to hold below the profile, the next potential target could be the green support level at $207.00.

If the price returns to the market profile, attention could shift to the Point of Control (POC) at $225.50, followed by the upper part of the profile at $230.50. Above the profile, at the top of the pattern, lies the red resistance level at $234.00. The RSI + MAs indicator shows readings of 35, 50 and 50. The RSI has moved out of the neutral zone, while both moving averages remain within it, meaning it is still too early to confirm the breakout.

Key Takeaways

The price has broken below the rising wedge, but the RSI + MAs indicator has yet to confirm further downside. At the same time, the short-term fundamental backdrop remains mixed: pressure on the AI sector has increased, although Nvidia’s business outlook remains strong.

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