Why Nvidia stock is set for a major breakout retest next week

Shares of Nvidia (NASDAQ: NVDA) appear poised for a key breakout retest next week after a strong rally pushed the stock toward new resistance levels.

This comes after the American semiconductor giant notched new record highs in its march toward the $200 target. 

Notably, NVDA shares were valued at $187, down 0.7% in the last trading session, while year to date the stock has gained over 35%.

The latest technical setup shared by charting platform TrendSpider suggested the momentum could be entering a brief consolidation phase before potentially resuming its uptrend.

According to the daily chart, Nvidia recently broke above a critical resistance zone near $184, which had capped price action for much of August and September. 

Following the breakout, NVDA briefly rallied toward $190 before pulling back slightly, indicating that traders may look for a retest of the prior resistance, now acting as support.

If the price successfully holds above the $184 and $185 area, the setup points toward a continuation of the rally, with the 1.618 Fibonacci extension projecting an upside target near $197.18. The stock also appears to be forming a cup-shaped base, a bullish pattern that often precedes major upside moves.

Supporting the bullish case, the Relative Rotation Histogram (RRH) shows Nvidia’s outperformance against the S&P 500 turning positive once again, suggesting growing strength relative to the broader market.

Wall Street bullish on NVDA stock 

Beyond the technical setup, several Wall Street analysts remain bullish on the stock, citing the company’s dominant role in the artificial intelligence sector.

For instance, analysts at Cantor Fitzgerald maintained an Overweight rating on NVDA shares and a $240 price target following Nvidia’s investment in OpenAI. 

The firm dubbed Nvidia the “de facto AI infrastructure company” driving the AI boom and dismissed concerns of market “circularity” or an AI bubble. 

Cantor highlighted Nvidia’s robust fundamentals, including 71.55% revenue growth, 69.85% gross margin, $72 billion in levered free cash flow, a 4.21 current ratio, and a 0.11 debt-to-equity ratio, as proof of its financial strength.

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