NVDA- Will the tides change?
Updated
In the 4-hour chart, I’ve labeled key Wyckoff phases that suggest NVIDIA is currently undergoing a redistribution process. They will be explained in this idea. The chart also highlights the presence of unrecovered green vector candles, which often represent market makers' or institutional shorts that they may want to recover. This analysis is not taking into consideration any news or earnings info. This is based off what I see in the chart, and my knowledge as an Astrologer. Let’s dive into the details:
Wyckoff Analysis
Current Situation
NVDA is currently near the top of the distribution range, where the UTAD has formed. The consistent rejection at the Supply Line reinforces the likelihood of further downside. It seems that buy volume has been gradually decreasing, while price has been rising, signaling a divergence. Additionally, the presence of unrecovered lime green vector candles below indicates potential targets where market makers or institutions might look to recover their shorts, typically areas of interest for price action to revisit.
Key Level to Watch
Before considering the more distant price targets, the first and most critical level to focus on is the 50% retracement of this up move ($111). If NVDA reaches this level and breaks below it with strong momentum, it would confirm a bearish scenario and suggest further downside. However, if the price bounces off this level, it could indicate a potential recovery and move higher, challenging the bearish outlook.
Future Path
The speculative path drawn on the chart suggests the following:
NVDA may break below the current range and head towards the Demand Line or the support levels below.
The price could go find the Preliminary Support levels around $75-$65 before any significant movement occurs. Price may range between these levels and $90 for some time.
The lower levels of support, particularly around $65-$75, are crucial as they represent areas where significant buying might re-emerge.
Mercury Retrograde Influence
It’s worth noting that we are currently in a period of Mercury retrograde, which began on August 5th and ends on August 28th. While this might seem unorthodox, my research has shown that certain stocks, including NVIDIA, have a tendency to experience trend reversals following the conclusion of Mercury retrograde periods. As the retrograde ends on August 28th, I expect to see a reversal in NVIDIA’s price action shortly thereafter, which aligns with the potential end of the redistribution phase.
Wyckoff Analysis
- Preliminary Supply (PSY): The initial area where selling pressure began to emerge, halting the previous uptrend. This suggests that larger players started to distribute their holdings.
- Selling Climax (SCLX): Following the PSY, this phase marked a sharp decline as selling pressure intensified, leading to a temporary bottom where selling reached its peak.
- Automatic Reaction (AR): After the selling climax, the price experienced a brief rally, marking the upper boundary of the distribution range as buyers temporarily gained control.
- Secondary Test (ST): The price returned to test the levels near the SCLX, confirming the distribution phase as supply continued to outweigh demand.
- Upthrust After Distribution (UTAD): This final push upwards likely trapped late buyers before supply completely overwhelmed demand, causing the price to start moving downward again. This is often a strong indicator that the distribution phase is nearing its end.
Current Situation
NVDA is currently near the top of the distribution range, where the UTAD has formed. The consistent rejection at the Supply Line reinforces the likelihood of further downside. It seems that buy volume has been gradually decreasing, while price has been rising, signaling a divergence. Additionally, the presence of unrecovered lime green vector candles below indicates potential targets where market makers or institutions might look to recover their shorts, typically areas of interest for price action to revisit.
Key Level to Watch
Before considering the more distant price targets, the first and most critical level to focus on is the 50% retracement of this up move ($111). If NVDA reaches this level and breaks below it with strong momentum, it would confirm a bearish scenario and suggest further downside. However, if the price bounces off this level, it could indicate a potential recovery and move higher, challenging the bearish outlook.
Future Path
The speculative path drawn on the chart suggests the following:
NVDA may break below the current range and head towards the Demand Line or the support levels below.
The price could go find the Preliminary Support levels around $75-$65 before any significant movement occurs. Price may range between these levels and $90 for some time.
The lower levels of support, particularly around $65-$75, are crucial as they represent areas where significant buying might re-emerge.
Mercury Retrograde Influence
It’s worth noting that we are currently in a period of Mercury retrograde, which began on August 5th and ends on August 28th. While this might seem unorthodox, my research has shown that certain stocks, including NVIDIA, have a tendency to experience trend reversals following the conclusion of Mercury retrograde periods. As the retrograde ends on August 28th, I expect to see a reversal in NVIDIA’s price action shortly thereafter, which aligns with the potential end of the redistribution phase.
Trade active
Just want to update this idea with a short analysis of recent price action. Looking at the larger scheme of things, the recent up move from $100 would be seen as a LPSY in Wyckoff method. The LPSY is a failed minor rally after the UTAD, signaling the end of any remaining demand and the likelihood of further downside as supply takes control. On the smaller time frame I have identified a redistribution, further supporting a continuation downward. The failed demand line highlights that buying pressure has weakened significantly, with several tests of the supply zone unable to break higher. The sharp sell-off following the UTAD suggests that sellers are starting to dominate. The next major level I see of NVDA is around $97, here we may see another LPSY. 
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