Nvidia (NASDAQ: NVDA) closed on Tuesday at $130.39, marking a 1.22% decline after slipping as low as $127.07 before reclaiming the critical $130 psychological support level.
The chipmaker’s retracement may signal a potential turning point as it continues to weather recent market volatility.
In pre-market trading on Wednesday, Nvidia showed signs of recovery, climbing 3.21% to $134.58. The bounce comes as Wall Street analysts maintain their confidence, reiterating buy ratings and highlighting the long-term growth potential of the AI and GPU giant.
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Some market observers suggest that this week could mark a bottom for NVDA, with renewed investor enthusiasm driven by positive sentiment and the company’s continued innovation pipeline.
Adding to this optimism, Nvidia’s CEO, Jensen Huang, recently introduced the “Jetson Nano Super”, a new AI chip designed for robotics applications.
Citi Maintains a bullish stance
Citi analyst Atif Malik continues to back Nvidia with a ‘Buy’ rating and a price target of $175. Addressing investor concerns over the ongoing debate between GPUs and custom ASICs, Malik commented:
“Recent custom ASIC chipmakers’ strong results — such as those from Marvell (MRVL) and Broadcom (AVGO) — are stirring up new investor questions on the old ‘GPU vs. Custom ASIC’ debate. As highlighted in our recent report, we expect both to coexist, with the software reprogrammability through CUDA being the biggest advantage for GPUs and Nvidia.”
Malik projects a $380 billion AI accelerator Total Addressable Market (TAM) by 2028, with AI GPUs maintaining a dominant 75% market share and custom ASICs taking 25%. He also notes that Nvidia’s Chip on Wafer on Substrate (CoWoS) capacity allocation at foundries is expected to rise to 60% in 2025, up from 56% in 2024.
Earlier this week on December 16, William Stein, CFA, senior technology analyst at Truist Securities, reaffirmed his ‘Buy’ rating for Nvidia while significantly increasing the stock’s price target to $204 — a notable jump from the previous target of $169.
What’s next for Nvidia?
Despite recent price volatility and the looming head-and-shoulders pattern that some technical analysts have highlighted, the broader outlook for Nvidia remains strong.
The company’s cutting-edge AI developments, robust foundry capacity growth, and dominance in GPU technology suggest that it is well-positioned to capitalize on the expanding AI market.
For investors, the question remains whether now is the time to load up on NVDA, especially with analysts pointing to significantly higher price targets. If the support levels hold and Nvidia maintains its momentum, the potential for a sharp reversal and a return to bullish territory appears increasingly likely.
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