The Daily Breakdown breaks down Nvidia ahead of earnings and dials in with a technical look at its weekly charts.
Wednesday’s TLDR
- Expectations are high for NVDA
- The chart has been choppy
- AMD hits one-year low
What’s happening?
It’s the report we’ve all been waiting for: Nvidia reports its Q4 earnings after the close.
Nvidia trails only Apple when it comes to market cap, so regardless of whether investors have a direct position in the name, it will have at least some impact on the broader market.
In fact, Nvidia makes up over 5% of the S&P 500 and more than 7% of the Nasdaq 100. It’s also the largest component within the SMH ETF, weighing in at almost 18%.
So what do we know?
Mega-cap companies like Amazon, Microsoft and Alphabet guided for huge CapEx spends in 2025, signaling a big increase from their spending levels in 2024. A bulk of those expenses will come from a continued buildout of their AI infrastructures. This should be a net benefit for Nvidia.
Analysts expect earnings of roughly 84 cents a share on revenue of $38.25 billion, representing growth of 63.5% and 73%, respectively.
That said, the stock’s reaction ultimately will not lie with what Nvidia did last quarter…it will hinge on what CEO Jensen Huang says on the conference call and what type of outlook the management team provides for Q1 and the upcoming fiscal year.
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The setup — Nvidia
In my opinion, the weekly chart of Nvidia is a much cleaner look than the daily chart given the choppy nature of the stock over the past few months.
In fact, you might notice that NVDA is actually below its high from June! Shares are still up about 60% over the past 12 months, but are flat over the past six months.
That’s not necessarily a bad thing, it just means NVDA has been consolidating. Keep in mind, shares were trading for about $24 this time two years ago and is up more than 400% since.
There’s a lot going on in this chart, so let’s break it down.
First, the resistance has been clear. That’s particularly true on rallies toward $150, which happened in early November and in very late December. Both rallies failed — so $150 to $155 is clear resistance right now.
Second, there’s a newer downtrend resistance mark (blue line) that started from the December highs and recently rejected Nvidia’s rally as recently as Friday. For active bulls, this is a key resistance mark to clear in the short term.
When it comes to support, the $125 to $130 area has actually buoyed Nvidia stock since the start of Q4. The only exception was the DeepSeek selloff last month, where shares temporarily broke this zone.
That sent NVDA down to the $115 area, where it found the 50-week moving average as support. So in the short-term, active investors want to see this area hold as support again should Nvidia decline.
A break of these levels — that’s either downtrend resistance on the upside near $140 or recent support on the downside near $115 — could expose Nvidia to a larger move in that respective direction.
Options
For options traders, calls or call spreads are one way for investors to speculate on more upside, while puts or put spreads allow them to speculate on further downside or allow bulls to hedge their long positions.
Using options around big events — like earnings — tend to be more expensive. However, one advantage is that the total risk of the trade is tied to the premium paid when buying options or option spreads.
For those looking to learn more about options, consider visiting the eToro Academy.
What Wall Street is watching
TSLA – Shares of Tesla tumbled on Tuesday, falling 10% at one point in the session. The stock has fallen in four straight sessions, declining 16% in that span, with yesterday’s selloff being fueled by reports that its European sales slumped by more than 40% in January on a year over year basis.
AMD – Shares of Advanced Micro Devices made new 52-week lows yesterday, and like Tesla, has now declined in four straight trading sessions. With Nvidia due to report earnings tonight, that has the potential to impact AMD — but will it be in a good way or a bad way? Check out the chart for AMD.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.