The signs of concern we wrote about yesterday have largely subsided. After three days of declines, the price of E-mini Nasdaq 100 futures bounced off the lower boundary of the channel (see yesterday's chart) and rose, led by NVDA stock.

Nvidia's quarterly report exceeded expectations:
→ earnings per share: actual = USD 5.16, expected = USD 4.59;
→ gross revenue: actual = USD 22.10 billion, expected = USD 20.39 billion.

According to the head of the company:
→ Accelerated computing and generative AI have reached a tipping point.
→ Demand for computing is growing worldwide among companies, industries and governments.
→ The coming year will bring major new product cycles with exceptional innovations that will help propel the industry forward.

In post-market trading, NVDA's price rose 11% to over USD 740 per share. Thus, the price increase for NVDA since the beginning of 2024 is about 50%.

The NVDA stock chart shows that:
→ the USD 740 level acted as resistance in February;
→ however, taking into account the post-market price, we can assume that today at the opening of trading this resistance level will be broken and in the future, according to the logic of technical analysis, will begin to provide support;
→ in this case, a rebound will be formed from the lower line of the channel (shown in blue) and a wide bullish gap.

It's likely that the excitement surrounding Nvidia's strong report will continue. But the closer the price of NVDA rises to the upper border of the channel (which is located around the psychological level of USD 800), the more signs of overbought there will be on the indicators — therefore, the preconditions will be created for a correction after the extraordinary growth.

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