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After hitting record highs of $974 at the beginning of March, Nvidia stock (NASDAQ: NVDA) took a nosedive. However, after forming a bottom around $841, the shares of the chip-making giant are poised to take another shot at the major psychological level of $1,000. This level is crucial in every stock's life cycle, as a clear breakout above this level results in a strong, bullish continuation.
The recent FOMC statement propelled Wall Street indices to their record highs. The S&P 500 index, NASDAQ 100 index, and Dow Jones Index, all three benchmarks of the US equity markets, are standing at their highest levels in history.
The ongoing uptrend in the risk assets is bolstered by the hopes of multiple rate cuts this year. The markets are now pricing in the first rate cut to occur in June. This outlook is backed by the CME Fed Watch Tool, which shows a 74.5% probability that the rates will come down in June.
In a major development in the semiconductor industry, Nvidia Inc.'s competitor, Intel Corporation, entered into a preliminary agreement for an $8.5 billion grant from the Biden administration. The news was taken very well by the whole industry as Intel, Nvidia, and AMD stocks surged the following day.
At the moment, NVDA is retesting the supply zone which lies above $920. A breakout may propel the price toward the all-time high around $974. This could be the final resistance level before the critical $1,000 level. A blue trendline, which is shown in the following chart, may also act as a diagonal support to create more supply around the record highs.
On the other hand, Nvidia stock price prediction might take a bearish turn in case of another rejection from the $920 resistance. In that case, another retest of $841 support is likely. In an extremely bearish scenario, the stock might also slip to $771, which is a critical support on the daily timeframe.
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