Nvidia (NASDAQ: NVDA) rose as high as 5% on Friday morning, after the semiconductor company posted earnings that beat Wall Street expectations.
However, the stock’s market cycles point to a pullback in the first half of the year.
The company reported earnings per share of $0.92 and total revenue of $2.2 billion, which was above the average analyst estimate. For the quarter, management’s sales guidance was $2.2 billion plus or minus 2%, compared to consensus of $2.32 billion.
CEO Jensen Huang said, “This was a turbulent close to what had been a great year. Despite this setback, our fundamental position and the markets we serve are strong.” However, the company a few weeks ago had lowered its guidance, prompting the stock to fall 14%.
In analyzing the NVDA’s market cycles, we can see that it is still in the rising phase of its current cycle.
However, it has retraced only 23.6% of the decline from its previous cycle, which indicates a weak recovery. We expect a test of its recent low around $122 by May.
Nvidia (NVDA) Stock Weekly Chart
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