NVDA: Short of the Century (Inverted Chart)
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I pulled up an inverted chart of NVDA because it provides me with a perspective that
forces me to set my bullish or bearish bias aside and look at the chart for what it truly is.
I think the chart speaks for its self because downside targets are completely justifiable,
assuming it revisits its golden zone price range and we can clearly see a double bottom
trend reversal pattern forming perfectly as the price sky rockets to out-of-control levels.
Coincidently NVDA reports earnings next Wednesday the 24th of May. In my experience,
price action like this, before earnings, often results in a major sell off. Just one more
reason to maintain confidence in your short positions in spite of days like today, where NVDA
spiked up over $15 or 10% in a single day. This is massive considering its market cap is nearly
half a trillion dollars, trillion with a fucking T.
Market capitalization and revenue are two metrics used for value estimation.
Market capitalization reflects the total value of a company based on its stock price.
Revenue is the amount of money a company earns as a result of sales. Apple is trading
at approximately 7x its revenue and historically it has been about 5x and lower. NVDA
on the other hand is trading 30x its revenue and has historically traded at about an average
of 10x its revenue. So while Apple has increased its earnings to market cap ratio, it is within
a modest 50% more than its average. NVDA is trading at an astronomical increase of triple
its average. For the permanent bulls out there I challenge you to find any reason at all to justify
an increase that substantial.
Good luck out there!
forces me to set my bullish or bearish bias aside and look at the chart for what it truly is.
I think the chart speaks for its self because downside targets are completely justifiable,
assuming it revisits its golden zone price range and we can clearly see a double bottom
trend reversal pattern forming perfectly as the price sky rockets to out-of-control levels.
Coincidently NVDA reports earnings next Wednesday the 24th of May. In my experience,
price action like this, before earnings, often results in a major sell off. Just one more
reason to maintain confidence in your short positions in spite of days like today, where NVDA
spiked up over $15 or 10% in a single day. This is massive considering its market cap is nearly
half a trillion dollars, trillion with a fucking T.
Market capitalization and revenue are two metrics used for value estimation.
Market capitalization reflects the total value of a company based on its stock price.
Revenue is the amount of money a company earns as a result of sales. Apple is trading
at approximately 7x its revenue and historically it has been about 5x and lower. NVDA
on the other hand is trading 30x its revenue and has historically traded at about an average
of 10x its revenue. So while Apple has increased its earnings to market cap ratio, it is within
a modest 50% more than its average. NVDA is trading at an astronomical increase of triple
its average. For the permanent bulls out there I challenge you to find any reason at all to justify
an increase that substantial.
Good luck out there!
注释
Let me know what you think. Do you ever use Inverted Charts when analysing stocks?
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