Nvidia kicked off the week on a high note, surpassing Apple and Microsoft to become the world’s largest company by market capitalization. However, the situation took a drastic turn by the end of trading on Thursday, the 140th day of the month. The stock opened at a historic high of $130 per share, but rapidly declined and closed just above $120.
The downward trend continued into after-hours trading, with Nvidia’s price further dropping to $126.86 at the time of writing. This decline not only caused Nvidia to lose its top spot as the world’s most valuable company but also formed a bearish pattern on the stock chart.
The pattern consists of a smaller green candle followed by a larger red candle, indicating a potential reversal of the previous upward trend. While the bearish signal suggests investors may consider selling or shorting, it does not guarantee a sustained decline.
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Furthermore, the rapid price fluctuations have made it difficult to determine clear support and resistance levels. However, as long as Nvidia’s stock price remains above $121, close to its post-split price, it is unlikely to experience a significant market downturn during the expected recovery period.
It is worth noting that if this market trend had occurred before the recent 10-to-1 split, the stock would have seen a decline of over $100 in a single trading day.