Nvidia stock faces short-term pressure amid supply chain disruptions
As of March 28, 2025, Nvidia Corporation (NVDA) is trading at $111.43, down 2.18% from the previous close.
The price action continues to reflect a correction phase following the explosive rally witnessed over 2023 and much of 2024. The short-term technical outlook has weakened considerably, with the stock now trading below its 50-day and 200-day moving averages, a setup typically associated with bearish sentiment. Moreover, the 50-day moving average has recently crossed below the 200-day moving average — a technical pattern known as a "death cross" — which signals a potential continuation of downward momentum in the near term.
Key support levels to watch are $105, which provided a temporary floor earlier this month, and $96, which marks a more critical level of demand tested last year. On the upside, the stock faces strong resistance at $130, where the 50-day moving average currently sits, and again at $150, the prior consolidation zone before the recent downturn.
NVDA stock price dynamics (January 2025 - March 2025). Source: TradingView.
The Relative Strength Index (RSI) is trading below the neutral 50 mark, currently around 41, suggesting that the stock is leaning toward oversold territory, though not quite there yet. Momentum indicators such as MACD and stochastic oscillators are also pointing downward, reinforcing the cautionary stance.
Market context and recent developments
Recent market dynamics have contributed significantly to Nvidia's weakness. The chipmaker has become entangled in broader geopolitical developments, most notably U.S.-China tensions and the implications of new U.S. trade tariffs. Washington has announced a 25% tariff on certain automotive imports, raising concerns about the potential extension of such measures to advanced semiconductors. Since Nvidia outsources much of its manufacturing to Taiwan, any escalation could disrupt its already strained supply chain.
Additionally, the U.S. government recently added several Chinese firms — including Inspur, one of Nvidia's customers — to its trade blacklist, raising concerns about potential demand headwinds from Asia. While Nvidia has diversified its customer base with strong demand from U.S.-based hyperscalers like Microsoft, Amazon, and Meta, the recent news that Microsoft has paused two new data center projects due to short-term oversupply could translate into lower near-term demand for Nvidia’s high-performance GPUs.
Nevertheless, long-term forecasts remain strong. Analysts still expect Nvidia to retain a dominant position in the AI accelerator market, with projections showing it could control up to 77% of global market share by 2030. This strategic advantage is driven by its CUDA software ecosystem, deep integration in AI workloads, and a robust roadmap of next-generation chips like Blackwell.
Price scenarios
In the short term, Nvidia appears vulnerable to further downside, especially if broader market sentiment remains risk-off. If NVDA breaks below the $105 support level, the next downside target is $96, a level that could prompt dip-buying by long-term investors. A failure to hold that would expose the stock to a steeper correction toward the $85–$90 region.
Alternatively, a relief rally driven by improved macro sentiment or strong earnings guidance in the next quarterly report could push NVDA back toward resistance at $130. However, for a sustainable uptrend to reemerge, the stock would need to reclaim the $150 level and reestablish itself above its key moving averages.
In February, Nvidia and Cisco expanded their partnership to simplify AI adoption by integrating Nvidia’s AI server technology with Cisco’s networking solutions for corporate data centers. The collaboration aims to bring advanced AI capabilities to a wider range of businesses and government entities, while strengthening Cisco’s position in the AI infrastructure market.
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