Is $NVDA the Beach Ball this market needs? Let’s take a look… – December 7, 2021

by DAN NVDA 
This is Scott with your Chart of the Day. I want to take a look at NVIDIA ( NASDAQ: NVDA ). Someone once told me that great stocks are like beach balls because no matter how much the market tries to hold them down, hold them underwater, they tend to explode to the upside. And so I am wondering if NVIDIA ( NASDAQ: NVDA ) is the beach ball that this market needs to start ripping to new highs again.

As you can see here on Monday the market tried to push NVIDIA ( NASDAQ: NVDA ) down. And then what happened? The stock rebounded and closed in the top quarter of the range, on pretty good volume. Now, although this volume is red, it is just red because technically the stock closed lower than the previous day. This is really kind of bullish volume here on a pretty strong reversal.

Today we had a good follow-through and a close right at resistance. Again, following pretty on pretty good volume here. I drew this downward sloping trendline and you can see we have clearly defined resistance on this downward sloping trendline. And, at least in the short-term, we have pretty good support right around this gray line here on the chart, that is the 21-day exponential period moving average.

So what I want to see from NVIDIA ( NASDAQ: NVDA ) is a follow-through on this chart to the upside coming on higher than average volume. That would truly be a beach ball, trying to be held underwater, exploding to the upside. So this stock is on top watch for me tomorrow. And I think it should make your watch list as well.

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