NVDA NVIDIA Daily Chart; Death Cross

The NVDA death cross was all the rage yesterday on business television and the internet. A death cross! Oh no! Hide the women and children! Anything but the death cross! All hope is lost! Calm down. Don't panic. The death cross is only one arrow in the technical quiver.

The death cross occurs when the 50-day moving average (MA) crosses down through the 200-day MA forecasting troubling bearish times and destruction ahead. Conversely, the golden cross is when the 50 pierces up through the 200 to signal happy days and rainbows and puppy dogs ahead. Neither is quite the case because the media does not understand the behavior of the crosses.

When a death cross occurs, it comes after many weeks and months of soggy prices that must roll the 50-day MA over and to the downside to set its sights on the 200. This takes time so typically when the death cross occurs, price bounces. The key is whether price remains below the 50 because, by definition, the 50 can only be dragged lower, and continue its slope lower, if price remains below the 50.

Thus, mathematicians say thus a lot, that is why we are never invited to parties, NVDA already begins bouncing before the death cross occurs. It makes sense since price is trending down for this year after those November and early-year highs. Price is stumbling sideways trying to regain its footing after the beat-down from Valentine's Day to early March. Talk about a jilted lover. Paul at Hyde.

The 50-day MA is 127 and dropping. Both the 50 and 200-day MA's are important so back kisses would be expected going forward. Very simply, when price comes up to back test the downward-falling 50-day MA, probably around 122-125, it will have to make a bounce or die decision. If price continues below the 50-day MA, the death cross remains valid and NVDA will be sick for many weeks forward. If NVDA pops back above the 50-day MA, the stock will stabilize, and then you can watch to see if the golden cross occurs in a few weeks to steer the chip ship around.

The daily chart hints that some additional upward buoyancy will occur with price perhaps to 122-125-ish. The weekly chart hints at a lot of sideways slop and chop ahead. The monthly chart, sorry to say for AI fanboys, is busted for NVDA. Based on the charts now, the path forward will be choppy sideways slop with a consistent downward bias probably through spring and summer into Fall. Thus, the death cross will probably maintain itself for a while.

The AI hype is rampant with daily promises of grandeur and yet no delivery of firm hard solid goods and examples exactly detailing how much money was saved. AI is keeping the softward engineers employed, at least for now. AI will allow call centers to can more employees and make your telephone experience even worse.

Will the billions in investment in AI chips and manhours prove worthwhile, or will companies be left holding the AI chip bag, only left to fry eggs on the overheating chips? The new chip will be called rubin after the scientist but what do you think of when you hear rubin? Of course, a reuben sandwich. Yuck. Nasty. It is an acquired taste. Some folks will crawl over crushed glass for a reuben sandwich but Keystone will pass on that and go with a BLT instead. Concerning the new reuben, er, rubin chip, people may take it or leave it like the sammich.

Keystone is not trading NVDA long or short currently. There is not much of a trade there long or short right now. Perhaps wait for the daily chart to move higher and form neggie d and that would be a potential area for a short; use the 2-hour to enter that if it becomes available. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.