Is it a good time to buy now that Nvidia’s stock has dropped 13% from its peak in March?
The massive chipmaker Nvidia’s shares have fallen nearly 14% this month from their high of $974 set in March as the market as a whole withdrew last week during a correction phase from all-time highs. On March 13, Wednesday, Nvidia’s stock was down 3.09 percent at $890.71 on the New York Stock Exchange. Opinions among market analysts regarding whether this represents a buying opportunity or if the rally is over for the time being are divided.
It is a little early to say for sure. Retractions of less than 12 percent have caused price movements higher in 2023 and 2024. Retractions greater than that have signaled erratic trading and more significant drops. The current decline is slightly over the 12% threshold (13.6%), according to Trading.biz analyst Cory Mitchell.
This uptrend will continue if the price moves higher very soon. Should it drop a little bit further, that suggests choppy trading for at least a month or a larger decline. Mitchell continued, “The company’s earnings are growing strongly, and the fundamentals still look good.
Analysts estimate that during the next five years, Nvidia’s earnings will increase by 30% annually. Even though earnings have increased, the majority of this upward trend has already happened.
Nvidia’s stock price fluctuations
There has been a greater decline in the stock price than is ideal. The price has typically continued to rise after a pullback of less than 12 percent since late 2022, when the rally was quite strong. However, following a rally, if the price declines by more than 12 percent, either the pullback continues (drops more) or there is choppier trading.
The price increased by 57% at the end of 2022, dropped by only 11.28%, and then began to rise once more. The subsequent retreat fell more than 12 percent and went on to drop 26 percent.
Early in 2023, the price saw a 66 percent rally; after that, it only fell 11.4 percent before rising to 105 percent. After the subsequent 10.9 percent decline, there was a 29 percent surge. The subsequent drop was sixteen percent, and months of erratic trading ensued.
The price increased by 66 percent from late 2023 to early 2024, then fell by just 11.2 percent before rising once more. Before selling off at 13.6 percent (the current pullback), it ran at 47 percent. Should this pattern hold, we can anticipate either further price declines or erratic trading over the coming months. There has been little to no progress above the recent high of $974 due to choppy trading.
