Nvidia forms bull flag; 20-day EMA, May 20 earnings key

Nvidia shares pulled back 8% from an April 27 peak of $216.87 and have formed a bull flag on the chart. The 20-day exponential moving average (EMA) at $198.20 is currently providing support. The company is scheduled to report earnings on May 20.

The rally that created the flagpole began at a late-March low of $164.11 and gained about 32% to the April 27 high. Eight trading sessions of price consolidation since then have confined the stock to a tight, descending channel. The May 4 close at $198.48 sat at the channel’s lower boundary and near the 20-day EMA.

A daily close above $207.12, the 0.236 Fibonacci retracement level, would indicate a breach of the flag’s upper boundary. Additional resistance levels appear at $214.82 and the April 27 high of $216.87. Above $216.87, technical targets include $221.04, $227.27 and $236.13. A measured-move target from the flag sits at $273.62, with a 1.618 extension at $280.03 and a 2.618 extension near $332.79.

On the downside, a daily close below $194.66 would cross the 20-day EMA and end the flag pattern on the chart. Below that level, the 50-day EMA is near $191.13 and the 100-day EMA near $186.95. A horizontal support level around $186.25, then $171.68 and the late-March floor at $164.11, are the next lower reference points.

Market indicators show a Chaikin Money Flow reading of about 0.34, which places the indicator above the zero line used to separate accumulation from distribution. Options data on April 27 recorded a put-call volume ratio of 0.38 and an open-interest ratio of 0.83. By the May 4 close the put-call volume ratio rose to 0.45 while the open-interest ratio edged down to 0.82.

Analyst targets have risen during the runup to the report. DBS raised its target to $250 on April 27 from $220. Bernstein has maintained a Buy rating with a $300 target. Bank of America reiterated a Buy on April 28. Rosenblatt’s target is $325. Several firms have targets clustered between $250 and $325.

Palantir reported strong first-quarter results on May 4, an event that coincided with higher sentiment in AI infrastructure names. Market participants are watching May price action and the May 20 earnings report for any change in the consolidation around the 20-day EMA at $198.20.