After a blowout performance to start the year, shares of Nvidia are showing signs of “upside exhaustion” and that could spell some near-term trouble ahead, according to Fairlead Strategies’ Katie Stockton. The chart analyst told CNBC’s ” Pro Talks ” on Wednesday that certain technical indicators suggest that Nvidia may soon enter a “corrective phase” that could lead to a slight pullback in shares, and recommended shying away from adding to positions right now. NVDA 1Y mountain Nvidia – 1-year “With that, we feel that the upside is capped, or limited here at least in the coming weeks to perhaps even months for Nvidia, and that there’s probably better opportunities elsewhere,” she said, in reaction to a prolonged overbought reading and other momentum indicators. Given this setup, she views the stock as a “hold” or a “weak hold” for investors, and recommends looking for opportunities with newer catalysts on both a technical and fundamental basis. She noted that the stock’s already reached her breakout target of $424. The stock finished Tuesday’s session at $424.05 but jumped above $439 at one point Wednesday. Nvidia shares have nearly tripled in 2023 as Wall Street bets on the semiconductor giant as the artificial intelligence giant to topple. Excitement around artificial intelligence and blowout guidance fueled by the trend have helped lift the company above a $1 trillion market capitalization. Like Stockton, Paul Meeks, a portfolio manager at Independent Solutions Wealth Management, recommends holding Nvidia shares. He cautions chasing the momentum but said he would weigh buying on a pullback to $400. “It’s going to be a while before we get our next fundamental check in on Nvidia,” Meeks said, noting that the next quarterly results won’t come until later this summer. ” Right now I’d just hold it, though it is my best AI pick.”
