NVIDIA (NVDA): Riding the AI-Capacity Boom—A Short-Term Breakout Strategy for June–July 2025
Quick price snapshot
Why NVDA Is Back on Every Trader’s Radar
NVIDIA’s May-quarter (fiscal Q1 2026) report blew away already lofty expectations—revenue leapt 255 % y/y and management guided to an even stronger July quarter, driven almost entirely by datacenter GPU demand. Two fresh headlines keep the momentum alive:
- Europe’s “200 AI-factories” pledge. CEO Jensen Huang told VivaTech on 12 June that at least 200 European AI datacenters will be built “in the next few years,” supported by five multibillion-dollar GPU “gigafactories.”
- TSMC’s 42 % YTD sales jump. Taiwan Semi’s January-May revenue shows the foundry running flat-out to supply Blackwell and Hopper GPUs, confirming an upstream demand wave that should flow straight into NVIDIA’s top line.
Together these datapoints extend the post-earnings narrative: the AI build-out is not peaking; it is broadening geographically and vertically.
Technical Landscape: Compression Before Expansion
- Post-split base: NVDA’s 10-for-1 split (3 June) reset the nominal price to the low 130s. Since then, the stock has recycled between $133 support (gap-fill) and $145 intraday resistance, printing a tight bull flag on declining volume—classic constructive consolidation.
- Momentum gauges: 14-day RSI cooled from 78 to 62, allowing energy to rebuild without breaking trend. The 21-EMA now climbs through $137, pressing price into the flag’s upper rail.
A volatility squeeze into a live fundamental catalyst is the sweet spot for short-term momentum traders.
Actionable Trade Plan
|
Parameter |
Level |
Rationale |
|
Entry zone |
$141–143 on intraday pullbacks or a 30-minute close above $145 |
Captures the flag breakout while keeping risk tight. |
|
Stop loss |
$134 (just below 50-SMA & flag base) |
Break here invalidates the bullish structure. |
|
Initial target (T1) |
$157 |
Measured move: height of flag ($145–$133) projected upward. |
|
Stretch target (T2) |
$165 |
1.618 × flag height, near the pre-split equivalent of $1,650. |
|
Timeframe |
2–4 weeks |
Expect acceleration once flag breaks; reevaluate after July FOMC (30 July). |
Risk-reward ≈ 1:2.3 to T1, 1:3.6 to T2—acceptable even for aggressive sizing.
Key Catalysts on the Calendar
|
Date |
Event |
Potential Impact |
|
20 Jun |
TSMC May sales detailed |
Confirms wafer allocation for Blackwell GPUs. |
|
25 Jun |
French parliament vote on AI-data-center energy incentives |
Positive ruling accelerates European build-out. |
|
Early Jul |
NVDA early-July mid-quarter update (historical pattern) |
Any upside tweak typically sparks buyers. |
Stay nimble around macro data (CPI 18 Jun, Fed FOMC 25 Jun) that could jolt rates and risk appetite.
Risk Management & Alternate Scenario
- Macro shock: If yields spike on a hot CPI print, richly valued AI names could air-pocket. Tight stop keeps damage controlled.
- Supply-chain delays: A TSMC or CoWoS bottleneck headline would undermine the bull thesis—watch foundry commentary.
- Alternate plan: Should price lose $133 on volume, flip bias. Short rallies into $135–136 with a stop over $138 and target $125 gap from 29 May.
Bottom Line
NVIDIA remains the market’s purest AI infrastructure proxy. A textbook volatility coil sits atop rock-solid fundamental demand signals, offering an attractive 2-4 week breakout setup. Let the chart confirm with a forceful close above $145, manage risk at $134, and you have a clean shot at $157–165 into mid-summer.
Disclaimer: This material is for educational purposes only. Trade at your own risk; position sizing and risk limits are your responsibility.
