Nvidia stock trades at $135 as AI gains offset $4.5 billion China write-down
Nvidia's recent earnings release was a strong catalyst for the stock
As of May 29, Nvidia stock is trading at $134.81, down 0.5% in the past 24 hours.
Despite the modest daily decline, NVDA has delivered a remarkable performance over the past month, gaining approximately 25%.
Highlights
- Nvidia is trading at $135, supported by strong AI-driven earnings despite a $4.5 billion China-related inventory write-down.
- The company’s global expansion, including a major GPU deal with Saudi Arabia’s HUMAIN, is helping offset geopolitical risks.
- Technical indicators remain bullish, with short-term resistance at $140 and support around $125.
This uptrend has been underpinned by robust investor enthusiasm around its AI leadership and strong quarterly earnings. Technically, Nvidia maintains a bullish structure with the 50-day simple moving average (SMA) positioned at $123.15 and the 200-day SMA at $112.48. The 50-day SMA recently crossed above the 200-day line, forming a golden cross — a classic bullish indicator suggesting continuation of the current upward trend.
Support is clearly defined at the $125 level, a psychological and technical floor, followed by a secondary support zone near $118, which coincides with a prior breakout point. On the upside, the first layer of resistance is located at $140, followed by $145 — a level that aligns with the upper Bollinger Band and also marks the top of the most recent rally before minor profit-taking emerged.
NVDA stock price dynamics (March 2025 - May 2025). Source: TradingView.
The Relative Strength Index (RSI) is currently hovering near 68, indicating the stock is approaching overbought territory but has not yet triggered a full technical reversal signal. This suggests that while momentum remains intact, short-term consolidation could be likely if the stock fails to break above $140 decisively. Volume has remained above its 20-day average, supporting the strength behind the rally.
Fundamental drivers: stellar earnings and global expansion strategy
Nvidia's recent earnings release was a strong catalyst for the stock. The company reported fiscal Q1 2026 revenue of $44.1 billion, marking a 69% year-over-year increase and far exceeding analyst expectations. Net income rose to $18.8 billion, up 26% from the same quarter last year, reflecting efficient margin expansion and exceptional demand in the AI chip sector.
The standout performer was the data center segment, which brought in $39.1 billion in revenue — a 73% jump from the prior year. This segment, which includes the highly sought-after H100 and Blackwell B200 AI accelerators, now accounts for over 85% of Nvidia’s total revenue. Despite regulatory setbacks, including a $4.5 billion inventory write-down due to export restrictions to China, Nvidia remains optimistic, guiding for $45 billion in revenue for Q2 2026.
CEO Jensen Huang addressed geopolitical concerns, especially surrounding U.S.-China tensions. He emphasized that continued export controls could hinder American competitiveness in AI while accelerating the development of domestic Chinese alternatives. To counterbalance this, Nvidia has launched aggressive global expansion strategies, including multibillion-dollar AI infrastructure deals in Saudi Arabia, the United Arab Emirates, and Taiwan. Moreover, the company is investing $500 billion over the next four years into U.S.-based manufacturing and R&D as part of its longer-term strategy to de-risk supply chains and meet growing demand domestically.
Consolidation before a fresh breakout toward $145
Looking ahead, Nvidia’s short-term trajectory will likely hinge on its ability to overcome the $140 resistance level. If this level is breached with strong volume confirmation, the next upside target lies near $145, a level that aligns with short-term Fibonacci extension projections and coincides with peak analyst price targets. A move above $145 would open the door to a potential retest of the all-time high range around $150–155 in the coming months.
However, if the stock fails to clear $140 in the near term, a pullback toward $125 would be expected. This would represent a healthy consolidation within an ongoing uptrend and could offer a more favorable risk-reward entry for investors.
Nvidia’s deal to supply 18,000 GPUs to Saudi Arabia’s HUMAIN highlights its strategic push into alternative markets amid China export restrictions. This move helps diversify its customer base and mitigate potential revenue losses tied to limitations on H20 chip sales.
