Nvidia shares boost after increased demand
One of the companies that has had the best performance in the stock market during the last year is that of Nvidia.
From the lows of March 2020, close to $180, the company has experienced a spectacular bullish rally that led the stock to surpass $810 per share in early July, a growth of more than 350%.
This spectacular growth is due to a number of reasons, such as the improvement in the expectations of the sector by:
- The shortage of microprocessor chips that currently exist in the market
- The increased demand for its graphics cards used among others in the cryptocurrency industry
At the end of May, the company announced that on July 21 it would make a split of 4 to 1 of its shares, that is, each old share would then become 4 new shares.
This decision was the result of doubts among the company's executives about the company's high share price. The management of the company considered that such a high price could detract from the interest of investors and slow down the bullish rally of the company, which is currently in a very sweet moment.
The split finally occurred on July 20. The stock ended the trading session at $748 and the 21 was starting to trade at $187 as indicated in the chart below with the horizontal ochre line.
The daily chart above shows Nvidia's share price evolution from March 9th to today, on a daily basis.
In the pre-opening of the market on July 21, the stock rose more than 4%, and finally the lows recorded on the day were $189.50 per share.
The split level at $187 and the day 21 low at $189.50, son the two benchmark levels that traders have used to buy Nvidia stocks in the last 3 days.
This situation together with the evolution of the RSI indicator could indicate, that this level is consolidating, and the path is clear for a new advance whose next reference level is located at $208.5 and represents the historical highs of Nvidia shares.
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