NVIDIA Shows Resilient Momentum Amid Technical Corrections and Strong Long-Term Growth Prospects

Technical Analysis

NVIDIA (NVDA) closed at $141.97 on June 13, 2025, down 2.09%. The stock traded in a range of $140.86 to $143.58, testing resistance at $142.63. The RSI is currently at 66, approaching overbought levels but still below the critical 70 threshold. Its 50-day moving average sits at $121.73, significantly below the current price, indicating a sustained uptrend; however, the 200-day moving average of $127.63 suggests longer-term strength. The MACD reading of 7.11 points to continued bullish momentum despite the recent pullback. Average daily volume (257 million shares) exceeds last session's volume of 178 million, signaling a temporary decrease in trading activity. ATR at approximately $2.97 reflects moderate volatility.

Support is located near $139.19 with a stop-loss level recommended near $137.04, underscoring key near-term risk thresholds. Immediate resistance remains at $142.63, with the next upside target near the 52-week high of $153.13.

For the next trading day (June 16), the stock may attempt to consolidate around current levels, potentially rebounding off support near $139.19 if the broader market remains stable. Over the coming week, given the strong technical backdrop and recent minor profit-taking, a gradual recovery toward mid-$140s is plausible, provided no negative macro shocks or sector-specific disruptions occur.

Fundamental Analysis

NVIDIA's market capitalization stands at $3.46 trillion, affirming its tech sector heavyweight status. The trailing twelve months (TTM) EPS is $3.10, supporting a relatively high valuation with a PE ratio of 45.80, which implies market expectations of sustained high growth. The dividend yield is nominal at 0.03% (TTM), indicating that capital appreciation remains the primary shareholder return focus.

DCF valuation estimates an intrinsic price of approximately $144.91, which is slightly above the current market price, suggesting the stock is trading near fair value with limited margin for error. Analyst consensus remains bullish with an aggregate price target median of $175 and a consensus "Buy" stance (58 out of 79 analysts advising buy or strong buy).

Recent fundamental challenges include the exclusion of China from revenue forecasts due to ongoing U.S. chip export restrictions and decelerating growth rates in core segments. However, NVIDIA's profitable expansion into AI-driven markets, hyperscaler demand, and sovereign contracts in the Middle East appear to insulate it from these geopolitical headwinds.

The company’s leadership and CEO Jensen Huang’s active engagement in securing global AI partnerships reinforce the long-term growth narrative. Despite short-term valuation pressure, NVIDIA’s technological moat and market dominance in GPUs and AI chips are intact, offering a solid long-term growth trajectory.

Intrinsic Value and Long-Term Investment Potential

The intrinsic value computed by DCF sits slightly above current price levels, suggesting the stock is fairly valued or modestly undervalued. Given the high PE ratio and limited dividend yield, the investment thesis hinges on continued innovation leadership and market expansion in AI, data centers, and adjacent segments over the medium to long term.

Risks include increasing geopolitical tensions, supply chain constraints, and margin compression from pricing pressures. Nonetheless, NVIDIA’s formidable R&D capabilities and strategic partnerships provide a durable competitive advantage and position the firm well for growth catalysts expected over the next 3-5 years.

Long-term investors might view NVDA as a compelling growth vehicle, contingent on tolerance for valuation multiples and sector cyclicality.

Overall Evaluation

NVIDIA currently trades close to intrinsic value with strong fundamental growth prospects supported by resilient technical momentum. Near-term price action is likely to see consolidation after recent volatility, with upside potential toward the mid-$140s and beyond.

Classifying the stock as a Hold is consistent with the technical correction underway and the mature valuation, despite robust long-term growth narratives. This rating reflects a balanced view between short-term volatility risks and long-horizon growth opportunities driven by AI and data center demand.

A Hold stance advises monitoring price action near support and resistance levels before seeking further accumulation, especially ahead of the earnings release on August 27, 2025, which may materially impact investor sentiment and valuation trajectories.