Nvidia stock gains 1.8% as AI rally eclipses hedge fund selloff

Traders Union
All News
Financial News
Nvidia stock gains

Highlights

- Nvidia stock continues its bullish trend, closing at $157.75 with a 1.8% daily gain and strong technical indicators.

- Despite significant insider selling by funds like Coatue, AI-driven demand and upcoming product launches support a positive outlook.

- Short-term consolidation is likely, but the medium-term target remains $165 to $175.

From a technical standpoint, Nvidia (NASDAQ: NVDA) exhibits robust bullish characteristics. The stock currently trades well above its 50-day and 200-day moving averages, reflecting long-term positive sentiment and continued institutional accumulation. Momentum indicators are strong, though starting to signal near-term caution.

Support is seen at $154.00, with stronger technical support around $148.00 where previous resistance was established in early June. On the upside, Nvidia faces minimal immediate resistance, with technical projections pointing toward $165.00 as the next ceiling, and $175.00 as a possible target if momentum continues.

NVDA stock price dynamics (April 2025 - June 2025). Source: TradingView

The Relative Strength Index (RSI) sits at 72, firmly in overbought territory. While this does not necessarily signal an imminent reversal, it often precedes periods of sideways movement or brief pullbacks, giving the market room to consolidate before a fresh leg upward. The Average Directional Index (ADX) remains elevated, confirming the strength of the ongoing uptrend.

Market drivers: AI demand outweighs insider selling

Nvidia recently achieved a market capitalization of $3.8 trillion, surpassing Microsoft to become the world’s most valuable publicly traded company. This rise is not merely speculative—it reflects the firm’s unparalleled position in AI chip manufacturing. Nvidia's GPUs are foundational to the current wave of AI innovation, powering data centers, large language models, and enterprise solutions globally.

Wall Street sentiment remains positive. Analysts from Wedbush and Loop Capital have reiterated their bullish outlooks. Loop Capital, in particular, raised its price target based on expected demand for Nvidia’s upcoming Blackwell Ultra chips and their projected release schedule in 2025. They envision a path for Nvidia to reach a $6 trillion valuation, a 58% premium from current levels.

However, this bullish narrative faces a notable counterweight: aggressive selling by major hedge funds. Philippe Laffont, founder of Coatue Management, has sold over 41 million Nvidia shares since March 2023, reducing his fund’s position by 83 percent. Coatue’s reduction reflects a growing trend among institutions locking in gains at these historically high valuations. While insider selling isn’t inherently bearish, the scale of these reductions suggests increasing caution among large stakeholders.

Short-term consolidation likely before next move

Looking ahead, Nvidia may enter a brief consolidation phase. With the RSI elevated and some profit-taking by large investors, the stock is likely to move sideways or slightly lower over the next one to two weeks. A trading range between $150.00 and $160.00 appears probable, allowing technical indicators to reset.

If Nvidia holds above $154.00 support, renewed buying could drive a test of the $165.00 level. A decisive break above that could open the door to $175.00 in the medium term. Given Nvidia’s dominant role in AI infrastructure and strong demand visibility, any near-term pullback is expected to be shallow and temporary.

Nvidia’s stock rebound is driven by strong AI demand and its dominance in high-performance GPUs. A recent multi-year deal with a Saudi AI firm highlights the company’s expanding global footprint beyond Western markets.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.