Nvidia (NVDA) - might be down almost 1% on Friday but lately the stock has been on fire.
It's still up more than 1% for the week and will finish higher for the third consecutive week.
Helping drive the stock's current rally was the company’s GTC event, where a keynote presentation from CEO Jensen Huang helped unleash a flood of buying among investors and drove the stock to new all-time highs.
Nvidia has drawn the praise of analysts too. For instance, Raymond James analysts recently raised their price target to $750 from $700 as they eye a rebound in enterprise spending and Nvidia’s new chip.
We have done well with Nvidia's technical, too.
Coronavirus Market Update: Sign up for TheStreet's Coronavirus Market Update newsletter and get the latest market headlines delivered to your inbox daily.
In March, I analyzed the stock as it probed for a bottom. Then earlier this month, the stock gave bulls a monthly-up rotation, setting the stage for an explosive rally over the prior 52-week highs near $615.
Advanced Micro Devices (AMD) - also has been trading well, likely on the back of Nvidia’s momentum. Can Nvidia continue its run?
Look at the way Nvidia stock faked out investors by breaking below the 200-day moving average, but skillfully holding the 50-week moving average in early March.
After that, shares exploded higher, surging through $590 resistance earlier this week, then pushing through the previous high. Since then, Nvidia stock has only built on that momentum.
From here, bulls should not necessarily rule out a continuation higher. While we’ve seen a big move in a short period of time, Nvidia also gave us a multi-quarter consolidation phase. So the move could last much longer than some currently expect.
On the upside, a move up through $650 has to put the 161.8% extension on traders’ radar up near $663. Above that opens the door to the $700 level and the two-times extension just above that.
On the downside, I would really like to see $615 act as support, along with the 10-day moving average. If both measures fail, bulls need to see the $590 level act as support. If it doesn’t, this stock will lose all of its short-term momentum.
Ultimately, traders may consider using a longer term price target of $750 to $780 if Nvidia can maintain its bullish momentum. The latter end of that range comes into play near the 261.8% extension.