Nvidia shares near level where technical traders see a breakout

The chipmaker has one of the lowest valuations among the Magnificent Seven tech behemoths. Photo by Justin Sullivan/Getty Images

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After months of sluggish returns, Nvidia Corp.’s stock is rallying again and close to breaking out of its narrow trading range, which market technicians see as a bullish signal.

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Shares of the chip giant rose more than 10 per cent over the past six sessions, their longest winning streak since October. This comes after substantial stretch of nothing, with the shares essentially flat from September 2025 through the end of last month. They closed trading Wednesday at US$182, near the US$185 level that technical traders are watching closely.

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Shares dipped 0.5 per cent on Thursday.

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“If Nvidia sustains above US$185, I would say the money is ready to run back in,” said Jonathan Krinsky, BTIG’s chief market technician. “The long-term trend remains positive.”

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Holding above the US$185 level would signal that the stock has put in its low and is ready to start climbing, according to Krinsky. “Since it was in an uptrend prior to the consolidation, we want to see this range-trading resolve with Nvidia moving higher,” he said.

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United States stocks rallied Wednesday after President Donald Trump announced a two-week truce in the war with Iran to let the two sides continue negotiating a ceasefire agreement and reopen the Strait of Hormuz, easing concerns about a possible global economic crisis. Nvidia led point gainers in the S&P 500 Index, rising 2.2 per cent.

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A breakout by the chipmaker would be welcome for investors. Nvidia’s stock — which for years was among the market’s best performers and still commands the largest weight in the S&P 500 — has been trading sideways for months amid concerns that megacap technology companies wouldn’t see meaningful returns on heavy spending to build infrastructure for artificial intelligence anytime soon.

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The shares may need to eclipse US$200 to make a decisive move higher, according to Buff Dormeier, chief technical analyst at Kingsview Partners in Fort Wayne, Indiana.

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“If we started to get a signal of that, we could easily be back to the races, especially since Nvidia is a bellwether for the megacaps and the broad market,” he said. “And if we do start to see capital redeploy, I think there’s a lot of room to the upside. Nvidia looks a lot healthier now than it has in the past from a valuation standpoint.”

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To Dormeier’s point, the stock does look relatively cheap. It’s trading at roughly 20 times earnings over the next 12 months, down substantially from its 10-year average multiple of around 36. It has one of the lowest valuations among the Magnificent Seven tech behemoths and is roughly in line with the broader S&P 500.

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Of course, if Nvidia shares fail to sustain their current rally, the bullish signal will cut the other way. Technicians are also watching the US$170 level, and if the stock falls below that price it could signal further downside.

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“Nvidia recently violated support there,” Dormeier said. “It’s where I’d draw a line in the sand as the important level to watch. If we were to break under there, and I think there’s a good possibility of that, I think shares could fall down to US$150.”