Key Takeaways

• Nvidia shares are nearing their all-time highs on continued optimism about sales of its artificial intelligence (AI) products.
• Foxconn said demand for Nvidia’s Blackwell system was “awfully huge.”
• Nvidia executive Bob Pette said with AI will “revolutionize” industry everywhere.

Shares of Nvidia (NVDA) are nearing their all-time highs Wednesday morning on positive news about the chipmaker’s artificial intelligence (AI) products.

Nvidia shares, which have ended higher the past five sessions, recently edged up to $133.30. Their all-time closing high is $135.58, achieved on June 18, and record intraday high is $140.76, recorded the following session two days later, after markets were closed for Juneteenth.

On Tuesday, contract electronics manufacturing giant Foxconn reported strong demand for its servers powered by Nvidia’s GB200 semiconductors, part of the latter’s Blackwell architecture. Microsoft announced it was “the 1st cloud” running the Blackwell system with GB200-powered AI servers. OpenAI also thanked Nvidia for delivering “one of the first engineering builds of the DGX B200 to our office.”

Nvida Says Blackwell Slashes Energy Consumption

Also yesterday, Nvidia noted that the Blackwell platform has slashed energy consumption by up to 2,000 times over the last decade for AI training models such as OpenAI’s GPT-4.

Bob Pette, vice president and general manager of Nvidia’s enterprise platforms, told participants at the company’s AI Summit that “We are in the dawn of a new industrial revolution,” adding that the firm is “designing our systems with not just performance in mind, but with energy efficiency in mind.”

Nvidia shares have soared about 170% this year.

Read the original article on Investopedia.

Key Takeaways

• Palantir shares jumped more than 6% Tuesday to a record high following bullish commentary from Ark Invest, which pointed out that the analytics software provider could have further potential upside from the AI boom.
• After breaking out above an ascending triangle in early July, the stock has continued to trend higher apart from a brief early-August correction, with gains accelerating last month after the software vendor’s inclusion into the S&P 500 index.
• During retracements, investors should watch important support levels on Palantir’s chart around $32.70, $29, and $25.50.
• A bars pattern, which extracts Palantir’s trend higher from May to August last year and positions it from the early-August low, forecasts a potential bullish price target in the stock of around $55.

Palantir Technologies (PLTR) shares are likely to remain in the spotlight after jumping to a record high Tuesday following bullish commentary from Ark Invest, which said that the analytics software provider could have further potential upside from the artificial intelligence (AI) boom.

The technology-focused asset manager’s European managing director Rahul Bhushan told CNBC in an interview that data analytics software names such as Palantir sit well positioned to capture AI market share from tech giants as demand grows for customized data and AI services that tailor to clients’ specific needs.

Palantir shares rose 6.6% to $41.45 on Tuesday. The stock has gained 141% since the start of the year as of Tuesday’s close, jumping nearly 37% in the past month alone as it got a boost from its recent inclusion in the S&P 500 index.

Below, we take a closer look at the technicals on Palantir’s chart and point out important price levels that investors may be watching.

Uptrend Continues

Since breaking out above an ascending triangle in early July, Palantir shares have continued to trend higher apart from a brief early August correction, with gains accelerating last month after the software vendor’s entrance into the S&P 500.

Importantly, above-average trading volumes have accompanied the stock’s rally, indicating active buying from market-tracking funds.

However, the shares may see short-term profit-taking, given the relative strength index (RSI) flashes overbought conditions and has formed a bearish divergence with the price.

Let’s take a look at three important support levels on Palantir’s chart and use technical analysis to forecast a potential bullish price target.

Important Support Levels to Watch

During an initial pullback, investors should eye the $32.70 level, a location on the chart just below the rising 50-day moving average where the shares may attract support near the August swing high and the Sept. 9 breakaway gap’s opening price.

Selling below this level may see the shares fall to $29, where the price could encounter buying interest near a trendline joining the July peak and September trough.

A deeper retracement could lead to a retest of the $25.50 region, an area where investors may look for entry points around the ascending triangle’s top trendline, which appears to have flipped from resistance into support.

Bullish Price Target to Monitor

To forecast a potential bullish price target in the stock, we can use a bars pattern, a subjective chart technique that uses prior price action to predict future moves. 

In this case, we’ll extract Palantir’s trend higher from May to August last year and position that move from the early August selloff low, which forecasts a price target of around $55.

We selected this prior move as it started from the lower trendline of an earlier ascending triangle on the chart, similar to how the stock’s current uptrend began.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia.

Key Takeaways

• Chinese stocks hit resistance on Tuesday after an update from the government on economic stimulus failed to meet investor expectations.
• The announcement of stimulus measures, including lowering interest rates and freeing up capital at banks, in late September had propelled Chinese equities to two-year highs.
• Analysts say the economy will require more robust fiscal support to stage the turnaround that equity markets are anticipating.

Chinese stocks came under pressure on Tuesday after a disappointing update from the government tempered some of last month’s exuberance that propelled Chinese stocks out of a bear market in recent weeks. 

The country’s economic planning agency said Tuesday it would accelerate some planned investments meant to help the country meet its 2024 growth goals but abstained from outlining new stimulus measures.

Late last month, the Chinese government announced a spate of monetary stimulus measures including lowering banks’ reserve requirements, cutting interest rates, and supporting equity markets. The long-awaited package restored some investor confidence in China, prompting a massive rally. The CSI 300, an index of mainland China’s largest stocks, soared 25% in a week. Hong Kong’s Hang Seng index also advanced more than 25% to a 2-year high. 

Investors were expecting more from Tuesday’s announcement. The CSI 300 jumped about 11% Tuesday morning as mainland markets reopened after a weeklong holiday, but pared its gains and closed up 5.9%. The Hang Seng tumbled more than 9% on Tuesday.

Shares of Chinese companies trading on U.S. exchanges also fell sharply on Tuesday. Chinese e-commerce giant Alibaba Holdings (BABA) fell 6.7%, while competitors JD.com (JD) and Temu-parent PDD Holdings (PDD) declined 7.5% and 5.4%, respectively. Electric vehicle makers Li Auto (LI) and Nio Inc. (NIO) each fell 8.1%.

Is China’s Stimulus Rally Over?

Before Tuesday’s announcement, some analysts worried that the rally had gotten ahead of itself. “On a shorter-term basis, price action is extremely overbought, and a pullback would not be surprising,” wrote Adam Turnquist, Chief Technical Strategist at LPL Financial, in a note last week. 

Pullbacks are common after a run-up as investors lock in profits, and they don’t always mean that the advance is over. That is especially true, Turnquist wrote, when a rally like this catches short-sellers by surprise, forcing them to cover their positions by buying the security they’ve sold short. According to the most recent Bank of America Fund Manager Survey, “short China” was the second most popular trade among professional money managers.

However, traders may still want to approach Chinese stocks with caution. “On a relative basis, China has made progress when compared to U.S. equity markets, but there is insufficient technical evidence suggesting a trend change toward sustainable China leadership is imminent,” said Turnquist.

What Will it Take To Revive the Rally?

Most experts agree that sustainably turning around China’s flagging stock market will require doing more to support the real economy. 

“So far, the approach is more directly beneficial for Chinese equities than for real growth and commodity demand,” wrote V22 Research analysts Michael Hirson and Houze Song in a note on Saturday. The government, they said, will need to unveil more robust measures to boost consumer spending and support the property sector for the wider economic outlook to improve. 

Hirson and Song see that stimulus coming closer to the end of the month, when they expect the government will announce “CNY 1 trillion yuan of stimulus spending over the next several quarters.” 

Read the original article on Investopedia.

Key Takeaways

• Pfizer shares have gained ground since a report over the weekend said that activist investor Starboard Value has taken a roughly $1 billion stake in the drug maker and is pushing for changes.
• The stock has formed a cup and handle, a chart pattern signaling a potential bullish reversal.
• Investors should watch higher price levels on Pfizer’s chart around $31.75, $34.75, $37, and $39.75, while also monitoring the $28.25 support area.

Pfizer (PFE) shares have gained ground since theThe Wall Street Journal reported over the weekend that activist investor Starboard Value has taken a roughly $1 billion stake in the drug maker and is pushing for changes at the company.

Since setting its pandemic-era high in December 2021, Pfizer shares have lost around half their value amid slumping demand for Covid-19 vaccines and treatments, with challenges compounded by setbacks in the highly lucrative obesity drug market and a recent global recall of its sickle cell disease medicine due to several adverse side effects.

Pfizer shares were up 0.1% at $29.24 in premarket trading Tuesday about two hours before the opening bell, after gaining more than 2% yesterday.

Below, we take a closer look at the technicals on Pfizer’s chart and point out key price levels worth watching out for.

Cup and Handle Pattern Signals Potential Bottom

Pfizer shares have formed a cup and handle, a chart pattern that resembles a cup and handle where the cup is in the shape of a “u” and the handle has a slight downward drift. 

Although the formation can indicate a continuation of an uptrend, it can also signal a potential bullish reversal, as is the case on the Pfizer chart. In addition, the 50-day moving average (MA) crossed above the 200-day MA in July to form a golden cross, a chart indicator also pointing to higher prices.

More recently, the stock has traded mostly sideways since breaking out from the pattern’s handle last month, though Monday’s volume-backed close above the 50-day MA may act as a catalyst for further upward momentum.

Higher Chart Levels to Watch

Amid further upside, investors should initially watch the $31.75 level, where the stock may encounter resistance from a trendline that connects multiple peaks and troughs on the chart and forms the cup and handle’s neckline.

A breakout above this level would confirm the pattern, which could fuel a move up to around $34.75, where the shares may face selling pressure near the August 2023 swing low.

Further buying may see the stock climb to the $37 region, a location on the chart where investors may look to place sell orders near a range of similar trading levels between May and August last year.

A longer-term bullish move could lead to a retest of $39.75, where the shares may meet overhead resistance near a period of March 2023 consolidation, an area that also closely aligns with last year’s May and June peaks.

This area also matches an upside price target projected by the measuring principle, which calculates the distance of the cup and handle’s cup in points and adds that amount to the pattern’s neckline. ($8 + $31.75 = $39.75).

Key Support Area to Monitor

If the shares fail to hold current levels, investors should keep an eye on how the price responds to the $28.25 area. A decisive breakdown below the recent sideways range could see a continuation of the stock’s longer-term downtrend.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia.

Key Takeaways

• Shares in server maker Super Micro Computer soared 16% Monday after the company reported strong shipments of its GPUs, fueled by AI demand.
• Super Micro Computer shares formed two troughs at similar levels on the chart last month, raising the possibility of a double bottom, a classic chart pattern that signals a potential bullish reversal.
• Investors should watch key overhead price levels on Super Micro’s chart around $48, $70, and $97.50, while monitoring important longer-term support near $35.50.

Shares in server maker Super Micro Computer (SMCI) soared 16% Monday after the company reported strong shipments of its GPUs, fueled by artificial intelligence (AI) demand.

The company, whose stock recently underwent a 10-for-1 stock split, also unveiled a new range of direct liquid cooling products for servers that it said could help AI firms cut their energy costs. 

While Super Micro shares have ridden the AI boom to generate a year-to-date return of around 68% through Monday’s close, they have lost more than half their value since setting a record high in March over concerns of deteriorating profit margins amid pricier next-generation AI chips and alleged accounting anomalies.

Below, we take a closer look at the Super Micro Computer chart and use technical analysis to identify important price levels that investors will likely be watching.

Potential Double Bottom

Super Micro Computer shares formed two troughs at similar levels last month, raising the possibility of a double bottom, a classic chart pattern that signals a potential bullish reversal.

Importantly, as the second trough made a slightly lower low, the relative strength index (RSI) formed a comparatively higher low to create a bullish divergence that points to weakening selling momentum.

More recently, today’s jump occurred on the highest trading volume in more than a week, suggesting buying conviction behind the move.

Overhead Chart Levels to Watch

The first higher level to eye sits around $48, a location on the chart just above Monday’s close where the shares may run into resistance near the early August swing low, the late August gap lower’s opening price, and last month’s high.

A decisive breakout above this level could see bulls drive a rally to the $70 region, where the stock finds a confluence of potential resistance from the late February pullback low, troughs in April and May, and the 200-day moving average. This area also lines up with the closely watched 38.2% Fibonacci retracement level when applying the tool from the March high to September low.

Ongoing buying may lead to a retest of the $97.50 area, where investors could look to exit positions near a multi-month trendline connecting a range of peaks on the chart between February and July.

Long-Term Support Level to Monitor

A failure to hold above the September low would invalidate the double bottom setup and could see the shares revisit lower major support around $35.50, where buy-and-hold investors may seek entry points near the August 2023 and January 2024 peaks, both of which marked prior record highs in the stock.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia.

Key Takeaways

• Oil prices have surged more than 10% in the last week amid escalating conflict in the Middle East that threatens to disrupt global oil supply.
• Stock investors have shrugged off the risks of soaring oil prices because the global growth outlook remains steady and prices remain too low to reignite inflation.
• Goldman Sachs analysts expect that even if the market lost a substantial amount of Iranian oil, prices still wouldn’t reach the inflationary levels they did in the wake of Russia’s invasion of Ukraine.

Oil prices continued rising on Monday as Israel’s war against Hamas appears as likely as ever to grow into a wider conflict that disrupts global oil supply. 

Brent crude futures contracts were up nearly 4% at $81 a barrel, their highest price since August, amid reports that President Joe Biden was discouraging Israel from attacking Iranian oil assets in retaliation for last week’s rocket barrage. 

Rising oil prices are often a headwind for the stock market, in part because they threaten to weigh on consumer spending and because they often go hand-in-hand with geopolitical tension.

Yet equities rallied to close higher last week even as tensions in the Middle East ramped up and sent oil prices soaring. The Dow finished the week at a record closing high, while the S&P 500 was near a record of its own before slipping 1% on Monday.

Why the Market Is Weathering Geopolitical Risk

One reason for the stock market’s resilience, Deutsche Bank analysts wrote in a note on Monday, is that today’s geopolitical risks haven’t changed the outlook for global growth.

The Middle East conflict’s disruptions to global oil flow and supply chains have been too small to drastically change the outlook in most major economies. Rather, events in the last few weeks—including Friday’s blowout jobs report and China’s recent stimulus measures—have improved the global growth outlook.

Oil prices have risen precipitously, but not enough to reignite inflation. Brent prices have increased 10% in the last 5 days, but at $81/barrel remained below the 2024 average.

According to Bank of America analysts, a 10% increase in oil prices adds less than a tenth of a percentage point to core inflation. They estimate oil would need to climb above $100/barrel for there to be a meaningful impact on inflation. Oil prices haven’t been that high since mid-2022 when markets were grappling with sanctions intended to stop the flow of oil out of Russia, one of the world’s largest producers.

Inflation expectations are a key driver of inflation, and gas prices play an outsized role in setting those expectations. However, BofA expects gas prices would need to nearly double to upend U.S. consumers’ inflation expectations, which improved for the fourth straight month in September.

Where Are Oil Prices Headed?

Oil analysts at Goldman Sachs wrote in a note on Friday that they don’t expect major disruptions to global oil supply. They estimate oil prices will range from $70 to $85 a barrel throughout the fourth quarter, and average $77 a barrel.

Major disruptions to Iranian supply would boost oil, Goldman says. Though the firm forecasts prices would peak in the mid $90s, even if the Organization of the Petroleum Exporting Countries (OPEC) didn’t increase production to offset the shortage.

Read the original article on Investopedia.

Episode 208 of the Investopedia Express podcast with Caleb Silver (Oct. 7, 2024)

Subscribe Now: Apple Podcasts / Spotify / PlayerFM

David Faber, co-host of CNBC’s Squawk on the Street, and the creator of The Faber Report, takes us through how he has broken some of the biggest business stories of the last thirty years, how the nature of business journalism has changed, and his quest to become the next host of Jeopardy. Plus, more all-time highs for the Dow and gold as the latest jobs report fluffs up the cushions for a soft landing. So why are some of the wealthiest people in the world selling their own stocks?

Links for Show Notes:

• https://www.investopedia.com/terms/c/collective-bargaining.asp
• https://www.investopedia.com/what-to-expect-in-the-markets-this-week-oct-7-2024-8722570
• https://www.investopedia.com/strong-job-market-makes-recession-less-likely-economy-labor-federal-reserve-8723504
• https://www.investopedia.com/us-dockworkers-suspend-strike-after-reaching-tentative-agreement-on-wages-8723165
• https://insidersentiment.com/
• https://www.cnbc.com/david-faber/
• https://sabew.org/
• https://washingtonservice.com/
• https://advantage.factset.com/hubfs/Website/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_100424.pdf

Read the original article on Investopedia.

Key Takeaways

• Tela’s highly anticipated robotaxi event is set to take place Thursday, with analysts expecting to see the autonomous taxi along with other product announcements.
• Analysts are somewhat split on Tesla stock, with nine “buy,” seven “hold,” and three “sell” or equivalent ratings among the 19 ratings tracked by Visible Alpha.
• The robotaxi event and Tesla’s third-quarter results later this month could be catalysts for the stock.

Tesla (TSLA) shares will be in focus this week, as the electric vehicle maker’s highly anticipated “robotaxi” event is set to take place Thursday, with analysts expecting to see the autonomous taxi along with other product announcements.

With its gains in the third quarter, Tesla’s stock price has largely recovered from the losses it sustained in the first half of the year. Shares were down just 1.5% for 2024 so far at $244.83 in intraday trading Monday.

Analysts are divided on the EV giant’s stock, with the 19 analysts tracked by Visible Alpha split between nine “buy,” seven “hold,” and three “sell” or equivalent ratings. Their average price target of $219.78 is roughly 10% below its Monday intraday price.

At Thursday’s event, analysts have said they expect to see a demo of the autonomous taxi along with a prototype and Tesla’s progress toward its full self driving software receiving regulatory approval for the vehicle to operate with no driver. Analysts also expect to see Thursday’s event include the unveiling of a lower-priced Tesla vehicle, and potential updates to Tesla’s other projects like the Optimus humanoid robot.

Last week’s deliveries data sent Tesla stock lower despite beating expectations, as analysts said investors may have wanted Tesla to deliver a stronger quarter. Thursday’s robotaxi event and Tesla’s full third-quarter financial results later this month could be the next catalysts for the stock.

Read the original article on Investopedia.

Key Takeaways

• ExxonMobil shares set a record high on Friday as investors bid up energy stocks over mounting concerns that escalating tensions in the Middle East could disrupt global oil supplies. 
• The stock broke out above the top trendline of a symmetrical triangle last week on increasing trading volume.
• Investors should watch key upside targets on Exxon’s chart around $134 and $138, while keeping an eye on important support areas near $118 and $112.

Shares in ExxonMobil (XOM) could remain in focus this week after setting a record high on Friday as investors bid up energy stocks over mounting concerns that escalating tensions in the Middle East could disrupt global oil supplies. 

The stock rose Friday despite a filing from the company on Thursday that said lower oil prices and refining margins will hurt third-quarter profit on a sequential basis. ExxonMobil is due to report its third-quarter results on Nov. 1.

The energy bellwether’s stock, which issues an attractive 3.04% dividend yield, trades about 25% higher since the start of the year as of Friday’s close. The stock gained 1.8% on Friday to close at $124.83, after hitting an all-time high of $125.19 during the session.

Below, we take a closer look at the technicals on Exxon’s chart and identify important price levels to watch out for.

Symmetrical Triangle Breakout

After setting their prior record high in early April, Exxon shares oscillated within a symmetrical triangle for five months before breaking out above the pattern’s upper trendline last week on increasing trading volume.

Moreover, the relative strength index (RSI) confirms bullish price momentum, though the indicator’s elevated reading nearing the 70 threshold also increases the chances of short-term pullbacks as investors lock in some profits following recent gains.

Let’s look at two potential upside targets in the stock, while also eyeing several key chart levels where the shares may attract support during retracements.

Upside Price Targets to Watch

Firstly, we’ll use the measuring principle to forecast a price target. This works by calculating the distance between the symmetrical triangle’s two trendlines and adding that figure to the pattern’s breakout point. For instance, we add $16 to $118, which projects an upside target of $134.

A more speculative method to determine a bullish price target involves using a bars pattern, a technique that uses historical price action to predict future moves. In this case, we’ll take the stock’s uptrend from January to April and reposition it from last month’s low, assuming a potential continuation move. This method projects an upside target of around $138, roughly in the same neighborhood as the measuring principle target. 

Key Support Levels to Monitor

During dips, investors should initially monitor the key $118 level, an area on the chart likely to attract buying interest near last week’s breakout point, which also aligns with a multi-month trendline stretching back to January last year.

A deeper pullback would increase the risk of a potential bull trap and could see Exxon shares fall to the the symmetrical triangle’s lower trendline around $112, an area that currently sits in close proximity to the upward sloping 200-day moving average.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia.

Key Takeaways

• The S&P 500 added 0.9% on Friday, Oct. 4, 2024, as strong September jobs data signaled resilience in the labor market.
• Shares of Albemarle, the world’s largest lithium producer, moved higher following reports that mining giant Rio Tinto is pursuing an acquisition in the industry.
• Concerns about mortgage rates pressured homebuilder stocks including D.R. Horton, Lennar, and PulteGroup.

Major U.S. equities indexes moved higher on the final trading day of the week after the release of strong labor market data. The S&P 500 added 0.9% on Friday, while the Nasdaq jumped 1.2%, and the Dow gained 0.8%. All three indexes ended posted moderate gains for the week.

U.S. employers added 254,000 jobs in September, marking the quickest pace of hiring since March and blowing past economists’ forecasts. The indication of resilience in the jobs market could lower the likelihood of another jumbo rate cut by the Federal Reserve.

Shares of lithium producers moved higher following reports that British-Australian mining giant Rio Tinto (RIO) might be considering an acquisition in the lithium industry. Although Rio Tinto is well known for its copper, iron ore, and diamond business, the company produces lithium and is reportedly looking to expand, even as prices for the metal have been pressured by soft electric vehicle (EV) demand. Shares of Albemarle (ALB), the world’s largest lithium producer, surged 8.2% on Friday, marking the top performance in the S&P 500.

United Airlines (UAL) shares gained 6.5% following reports that low-cost rival Spirit Airlines (SAVE) is considering a bankruptcy filing in the wake of its failed merger with JetBlue Airways (JBLU). Spirit is also said to be exploring options to restructure its balance sheet as it faces billions of dollars in debt. Spirit shares plummeted 24.6% on Friday, while JetBlue shares soared 14.2%.

Deckers Outdoor (DECK) shares added 6.4% on the day. The parent company of the Ugg, Hoka, and Teva footwear brands is a relatively fresh addition to the S&P 500, having joined the benchmark index in March. More recently, Deckers Outdoor completed a six-for-one stock split in September. Following the split, Baird analysts highlighted Deckers stock for its “best-in-class growth.”

Extra Space Storage (EXR) shares dropped 3.9%, the biggest loss of any S&P 500 stock on Friday. The downtick for the self-storage real estate investment trust (REIT) came after regulatory filings revealed CEO Joseph D. Margolis sold around $1.34 million worth of shares in the company. Investors often consider significant sales by company insiders as a potential warning signal.

Shares of credit reporting agency Equifax (EFX) sank 3.4%. Earlier this week, UBS initiated coverage on Equifax stock with a “buy” rating, asserting that the company could be positioned to benefit from an expected normalization in the mortgage market. However, there could be less certainty around a mortgage recovery after today’s jobs report, which raised questions about the likely pace of interest-rate cuts by the Federal Reserve.

Concerns about Fed rate cuts and the trajectory of mortgage rates weighed on companies in the homebuilding industry. Shares of homebuilders D.R. Horton (DHI) fell 2.9%, while shares of both Lennar (LEN) and PulteGroup (PHM) were down 2.5%.

Read the original article on Investopedia.