The current strong performance of Nvidia (NASDAQ: NVDA), which posted a 10-for-1 stock split and continued with gains, has been overshadowed by a significant amount of insider selling, which may indicate that NVDA stock could soon reverse its price progression.
NVDA stock closed the latest trading session at a valuation of $134.91 after adding 2.68% and 10.92% in the previous five trading days.
Zooming out, the year-to-date (YTD) chart shows a substantial gain of 180% since January 1.
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Insiders sold millions worth of NVDA stock
According to the data compiled by Finbold, so far in 2024, insiders have sold over 3 million Nvidia shares worth over $1 billion.
Nvidia CEO Jensen Huang leads the insider sales with over 2.1 million shares sold for a profit of $239 million. This is part of his announced Rule 10b5-1 plan, which allows company insiders to sell shares over a predetermined period of time to avoid accusations of insider trading.
He is followed by Mark Stevens, an Nvidia board member who offloaded over 680,000 shares in the first half of 2024 while pocketing $223 million.
Tench Coxe and CFO Colette Kress share third place, having sold 300,000 shares each. However, Coxe sold his shares before the stock split and earned $290 million, while Kress earned $36 million at the same amount.
In total, the sentiment heavily favors insider sales, as 41 insider sales were made in 2024, compared to zero buys.
Technical indicators show potential trouble in the short term for NVDA stock
NVDA is showing robust growth within a rising trend channel over the medium to long term. This upward trend signals positive development for the company and increasing investor interest.
The price chart shows no resistance, suggesting further potential for growth. However, the stock has support at around $95 if there is a negative reaction.
Simple moving averages (SMA) over the 50,100,200 time periods showcase that NVDA’s price is exhibiting strong growth.
Notably, the relative strength index (RSI) curve is trending downward, which could be an early indicator of a potential downward trend reversal in the stock price.
Despite this, the fundamentals and analysts’ price targets for NVDA stock showcase that the current price has more room for growth, and insider sales have been purely profit-taking oriented.
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