Nvidia has gapped higher on Wednesday, as traders react to the news that SpaceX is going to use only NVDA.
NVIDIA (NVDA)
Nvidia has jumped on Wednesday, gapping much higher to break above the $220 level, freeing itself from significant resistance in reaction to a lot of different things. But one of the biggest things, of course, is that Elon Musk said during the SpaceX earnings call that they are sticking with Nvidia chips for everything.
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That is a major acquisition by Nvidia and one that if you read the online comments from Musk recently, there have been obviously a lot of pro-Nvidia statements from Musk. So, I don't know that this is a major surprise; I just think that it was yet another reason to buy Nvidia. The artificial intelligence trade seems to be back, at least in the short term, and therefore, it's not a huge surprise to see this type of move.
We are giving back some of the gains, but at this point in time, as I record this going into the afternoon in New York, we are well over 3% higher.
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The market has recently formed a bit of a double bottom at the 200-day EMA. I think this is a good sign and ultimately could have been a great entry signal. Anyway, the $200 level is an area of interest if we do fall to there, but right now, this looks extraordinarily bullish.
I suspect that plenty of buyers will be willing to get involved on dips to take advantage of value in a market that, quite frankly, has been the darling of Wall Street for a couple of years now, although there's been some rough patches. If the AI trade truly starts to take off again, Nvidia is one of the biggest names.
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