Technical indicators point to a risk of further decline in Nvidia's shares, reports CNBC.
Recently, the company's shares fell by more than 7%, lagging behind the Nasdaq index, which lost about 3%.
Market sentiment has worsened towards companies in the artificial intelligence sector amid issues related to data centers and rising computing costs.
From a technical perspective, Nvidia's shares have approached a critical support level of $207, where the 50-day moving average lies. If buyers cannot maintain this level, the price could drop to $195–200. The MACD indicator points to a bearish trend, while the relative strength index is around the 40s, indicating that the shares have not yet reached oversold levels and there is additional potential for decline.
Despite the short-term weakness, Nvidia remains the most valuable company in the world and a key player in the artificial intelligence market. The shares continue to be considered attractive in the long term, with a multiplier below 17 for the projected earnings for the 2028 financial year, but future movements will be determined by the upcoming quarterly results.
