For much of the past year, NVIDIA Corporation (NVDA) has largely been contained in an inclining parallel channel. However, the price action on Thursday and Friday of last week marked a significant departure from this trend. NVDA has officially broken beneath the lower boundary of this structural “home” for a second time this month, signaling a potential shift from aggressive bullishness to a more cautious, corrective phase.
The new ceiling: $189.95
In technical analysis, former support often transforms into new resistance, a concept known as “role reversal.” The bottom of the parallel channel, situated at $189.95, is now the most critical level for the bulls to overcome.
- The bull case: To regain its primary bullish momentum, NVDA must not only touch $189.95 but decisively close back inside the channel. A failure to do so would confirm the breakdown and likely invite further technical selling as “stop-losses” are triggered.
Downside targets: Where is the floor?
With the stock currently trading just below its primary trendline, investors are looking to horizontal support levels to gauge where the selling might exhaust itself.
- Minor support ($169.56): This represents the first line of defense. If the selling persists in the short term, expect buyers to attempt a stand here. A bounce at this level could lead to a “retest” of the broken channel line from underneath.
- Major support ($153.13): Should the $169.56 level fail to hold, the technical focus shifts to $153.13. This is a significant structural area that represents a deeper retracement. Holding this level would be vital for maintaining the long-term integrity of the stock’s multi-year uptrend.
Summary
NVIDIA is at a technical tipping point. The break below the $189.95 channel floor is a warning sign that the momentum which carried the stock through 2025 is stalling. While their fundamental AI narrative remains strong, the chart suggests that the “easy money” phase of the rally has paused. Traders should watch the $189.95 level closely; until that level is reclaimed, the path of least resistance remains skewed toward a test of the $169.56 and $153.13 support zones.
Source: https://www.fxstreet.com/news/nvidia-trend-shift-again-the-battle-to-reclaim-the-parallel-channel-202602180345
