NVIDIA Shows Strong Technical and Fundamental Momentum Ahead of Potential Market Upswing

Technical Analysis

NVIDIA (NVDA) closed at $139.99 on June 5, 2025, down 1.36% from the previous session, with intraday volatility ranging between $138.87 and $144. The stock is currently trading below its near-term intraday resistance at $141.22 but remains above support at $139.19 and the suggested stop-loss around $135.32. The 14-day RSI at 59 signals mild bullish momentum without overextension. The MACD remains strongly positive at 10.39, indicating an ongoing bullish trend. The 50-day moving average ($117.85) and 200-day moving average ($127.16) are both comfortably below the current price, reinforcing medium-to-long-term upward momentum. Average daily volume is slightly above normal, suggesting moderate investor interest and liquidity.

For June 6, 2025 (next trading day), the price is likely to hover in the $139-$141 range, testing the near-term resistance. Given yesterday’s pullback and support levels holding, a modest rebound or sideways consolidation is probable. Over the week, barring negative catalysts, momentum indicators and moving averages suggest a continuation of the uptrend toward the $145 to $150 range, in line with trend and technical support.

Fundamental Analysis

NVIDIA’s market capitalization stands robust at $3.42 trillion. With a trailing twelve months (TTM) earnings per share (EPS) of $3.09 and a high price-to-earnings (P/E) ratio of 45.3, the stock trades at a premium reflecting significant growth expectations. The discounted cash flow (DCF) model values the stock at approximately $145.45, modestly higher than the current price, suggesting slight undervaluation at present levels based on intrinsic cash flow assumptions.

NVIDIA’s dividend yield remains negligible at 0.03% (TTM), positioning the stock as a primarily growth-focused asset rather than an income vehicle. The company’s next earnings announcement is scheduled for August 27, 2025.

Recent news highlights strong fundamentals driven by the Blackwell platform and data center expansion. Capital expenditures in data centers are projected to triple by 2029, with NVIDIA poised to capitalize on surging AI infrastructure demand despite challenges like tariffs and inventory losses. Management’s commitment to maintaining gross margins in the mid-70% range reinforces operational strength. Broadcom’s outperformance underscores persistent robust demand in the semiconductor and AI sectors.

Analyst consensus tilts decisively bullish: a consensus price target of $173.33 with a median at $175, and a strong buy/buy majority (57 out of 75 ratings) with only 3 sell ratings. A June “blue-chip fat pitch” listing identifies NVIDIA as an undervalued opportunity with more than 100% return potential if valuations revert to historical norms, signaling long-term appreciation potential anchored in fundamental growth.

Intrinsic Value and Long-term Potential

The DCF valuation near $145.45 aligns closely with current prices, implying a fair intrinsic value slightly above market price. This indicates limited near-term undervaluation but supports the stock as fairly priced relative to growth prospects. NVIDIA’s dominance in AI hardware, expanding addressable markets, and strategic product launches (Blackwell platform) underpin durable revenue growth and margin sustainability. The elevated P/E ratio is justified by anticipated earnings expansion linked to AI and data center adoption, making long-term investment thesis compelling when viewed through a growth lens.

Risks include exposure to global trade policies (tariffs), inventory write-downs ($8 billion estimated loss from excess H2O inventory), and valuation sensitivity to macroeconomic cycles; however, these risks appear priced into current multiples and supported by management guidance.

Summary Evaluation

NVIDIA displays robust technical momentum with key moving averages well below the current price and RSI indicating room for further upside. Fundamental growth drivers remain strong, supported by expansion in AI infrastructure and a solid product pipeline. The premium valuation reflects justified growth expectations, with intrinsic value slightly above the current market price. Analyst consensus and recent bullish sector dynamics bolster the positive outlook.

Categorizing NVIDIA as a Buy candidate aligns with its leadership in high-growth AI markets, strong fundamentals, and supportive technical indicators. Short-term price fluctuations around $140-$145 range are normal, but medium-term targets in the $170-$190 range are supported by analyst forecasts and intrinsic value drivers.