The combination of Nvidia's death Cross and a break below the $100 price mark will target longer-term selling as investors continue to question whether NVIDIA and other AI related stocks are in the beginning of a post-bubble re-valuation.
From a long-term perspective, Invidious shares remain in a long-term bull market trend with the stock’s 20-month moving average residing at $95. A move below that price will put the stock in a long-term bear market trend.
NVIDIA’s last long-term bear market occurred in 2022, immediately following the Death Cross mentioned above, April through October.
Long-term investors should approach the stock cautiously given the heightened risk of the chip giant’s potential for extended losses.
The first is the $100 price. At $100, NVIDIA becomes a potential short-term buy for short-term traders as the stock should get immediate support from the fact that $100 is a psychologically important support price. Shares benefitted from this support last August following the company’s earnings results.
Just below at $95 stands the stock’s 20-month moving average. This long-term trendline is the line of demarcation between a long-term bull and bear market. Shares should find some support from long-term investors buying the dip, but things are a little uncertain to expect the stock to be saved by technicals alone.
Bottom Line on NVIDIA’s Technicals
The market’s current conditions imply a much larger than normal risk to NVIDIA stock. Last week’s Death Cross was the potential trigger for shares to move into its next bear market trend that may target prices as low as $85, another 25% lower than this week’s price.
Trades of the Week
There are two ways to trade the bearish trend in NVIDIA stock.
Investors with experience trading options can choose to leverage the expected move with put options on NVIDIA. I’ll get to that trade idea in a minute, first let’s look at a way that an individual investors can profit from NVIDIA’s bearish trend.
Bearish NVIDIA ETF
The NVDS ETF is the Tradr 1.5X Short NVDA Daily ETF, which targets 1.5 times the inverse daily performance of NVIDIA Corporation's stock. This means for every 1% NVIDIA goes down the NVDS goes up roughly 1.5%.
The ETF is available for purchase through any brokerage account without any additional qualifications needed making it a simple way to generate positive returns from NVIDIA’s negative trend.
The ETF carries a 1.15% management fee and pays a “dividend”, though this should not be considered a long-term holding in a situation, just a short-term hedge on NVIDIA stock.
The shares are currently priced at 28.25 with a target of $35-$40 over the next 3-6 months.
Based on current prices, the forecasted move represents a potential 30% gain on NVIDIA’s potential move to $90.
For the Options Traders
Options traders looking to profit from NVIDIA’s bearish outlook can consider an intermediate-term expiration put option with three to six months.
Some traders may ask “why so much time premium?” Here’s why.
NVIDIA’s current trend is an intermediate- to long-term shift in the stock’s price meaning that the stock’s trend is still susceptible to short-term buying support and Dead Cat Bounces.
While true traders prefer volatility, this outlook focuses on a trend. For that reason, it is usually best to match the period of the option with that of the trend. Believe me, there’s nothing worse than nailing the target price of a stock only to see the time premium disappear on your option.
That in mind, the NVIDIA September 19, 2025 $105 Put is currently price at $1,125 per contract. This option provides leverage when NVIDIA shares cross below $105 and will continue to appreciate quickly with a fast and aggressive move below $100 and $95.
Based solely on intrinsic value, this put option would be worth $2,000 at the target price of $85. Theoretically, the option would hold a value of $2146 or more if NVIDIA traded to the targeted $85 price before July 1, 2025.
As always, investors need to endure that they have the options trading education, experience and understand the risks associated with options to participate in this or any other option trading strategy.