Yesterday Nvidia's Intraday Price Action and Closing Price Were Unpleasant


 

Nvidia's chart yesterday indicates a typical "Blow of the top" pattern.

In other words, the stock first rises sharply during the session, but closes negatively at the same rate as the increase. This movement indicates that the stock has reached its peak and is at the beginning of a downtrend in many cases.

On the other hand, determining an investment strategy with a single indicator or a single day's movement may not yield very good results. In other words, yesterday's movement may only be a temporary correction, we need to continue to monitor.

Moreover, today is OPEX day.

In other words, the closing day of futures options. Today, we will witness the largest futures options closing in the history of US stock markets: $5.1 Trillion.

On such days and before, sharp movements are observed in stocks, but the effect is usually temporary.

And again, there is another issue that triggers sharp price movements in the markets today: $XLK Rebalancing.

$XLK is the largest US technology sector ETF.

The distribution and weight of the stocks in this index changes every three months. It is difficult to know in what direction these changes will be, but it is certain that they will have an impact on Nvidia stock. XLK has a size of approximately $72 billion.

My opinion is that all these fluctuations are temporary.

We are at the beginning of the artificial intelligence revolution and the US is winning its fight against inflation. Therefore, there is no change in my medium-long term view.

I will still follow the market closely.

I do not plan to make any purchases or sales today. My screen will be off until Monday. I do not want to give too much meaning to stock price movements when Opex and XLK are overlapping.

Of course, everyone's risk tolerance is different, what I have explained is not investment advice, you should draw your own strategy.

The information, comments and recommendations contained herein are not within the scope of investment consultancy. Investment consultancy services are provided within the framework of the investment consultancy agreement to be signed between brokerage firms, portfolio management companies, banks that do not accept deposits and customers. The comments in this article are only my personal comments and these comments may not be appropriate for your financial situation and risk return. For this reason, investments should not be made based on the information and comments in my articles.

 

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