Nvidia (NASDAQ: NVDA) stock has been regularly setting records, reaching new all-time highs almost daily on a seemingly unstoppable upward trend. However, one recent milestone is that NVDA reached a weekly RSI above 90.
When the RSI surpasses 70, it typically indicates sell signals, suggesting that a security is overbought or overvalued. An RSI above 90 may indicate a potential price decline for NVDA shares.
Insiders sold over $180 million of NVDA stock this week
And maybe NVDA stock won’t beat technical indicators this time, with an insider argument against its price.
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During the first week of March, Nvidia shareholders opted to capitalize on their investments by selling over $180 million worth of Nvidia shares.
For instance, Tench Coxe, the third-largest shareholder of Nvidia, recently divested 200,000 NVDA shares, amounting to $170 million.
Additionally, Mark Stevens, a director since 2008, sold 12,000 shares on March 4, with prices ranging from $852.06 to $855.02, resulting in a total sale value of approximately $10 million.
Do these insider trades suggest more than profit-taking, especially given the surge in the weekly RSI past 90?
History and Cisco offer more insight
In March 2000, Cisco (NASDAQ: CSCO) reached its zenith, trading 37 times trailing sales, a remarkable feat that positioned it as the most valuable listed company globally. Since then, Cisco has seen its earnings-per-share surge nearly tenfold, accompanied by a comparable rise in sales-per-share.
However, despite these impressive metrics, the stock still lags, sitting at 39% below its 2000 highs.
Presently, Nvidia is in a similar position, trading 37 times sales.
A high weekly RSI, insider trading, and a potential pattern similar to that of CSCO stock could spell an ominous sign for NVDA stock’s future.
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