overview
- Nvidia stock is trying to stabilize above the $200 level after falling recently due to semiconductor market pressures and concerns about AI valuations.
- The Philadelphia Semiconductor Index has entered a technical bear market, impacting Nvidia and other AI-related chip companies as investors reassess their growth expectations.
- Nvidia is expanding its partnership in Japan to enhance its AI infrastructure opportunities at the same time it faces increasing competition from large customers developing custom chips.
- Despite the recent stock correction, Nvidia’s performance remains strong, with demand for AI and high-speed computing driving record revenue growth.
Nvidia stock is trying to stabilize above the psychological $200 level as a new wave of semiconductor selling raises concerns about AI valuations, hyperscaler spending and rapid improvements in China’s artificial intelligence models.
Shares closed 2.21% lower at $202.81, but recovered slightly to $203.54 in overnight trading.
NVIDIA stock falls 2.2% as AI trade loses momentum
Nvidia remained under pressure as investors continued to reduce exposure to some of the best-performing semiconductor companies on the market.
The Philadelphia Semiconductor Index fell about 10% for the week and entered a technical bear market after falling more than 20% from its June high. Nvidia, Micron, Intel and other AI-related chip companies were among the stocks affected as investors questioned whether big AI investments could continue to generate the growth needed to support rising valuations.
Nvidia is currently down about 14% from its 2026 high, and the stock is in a technical correction despite continued demand for its AI accelerators, network systems and software.
The market’s concern is not that demand for AI infrastructure has disappeared.
Instead, the extraordinary rise in stock prices has made investors more selective, seeking evidence that technology companies can turn rapidly increasing capital spending into equally strong revenue and profit growth.
Therefore, upcoming revenue from Alphabet, Microsoft, Amazon, and Meta could be a big catalyst for Nvidia.
Confidence in Nvidia’s growth prospects could quickly return if hyperscalers maintain or increase their AI infrastructure budgets. But any hint that spending is slowing could lead to another sell-off across the semiconductor sector.
Kimi K3 revives concerns about China’s AI competition
The recent push also followed the release of Kimi K3, a large-scale open artificial intelligence model developed by China’s Moonshot AI.
The model was described as one of the world’s largest open models, and was evidence that Chinese developers continue to close the gap with large US AI companies.
The release contributed to investor concerns that lower-priced Chinese models could challenge the dominance of U.S. developers and change the economics of AI infrastructure.
For Nvidia, the implications are mixed.
Increasing the number of capable global AI models is likely to increase the overall demand for computing power. Training and operating increasingly sophisticated systems still require powerful accelerators, networking equipment, and software tools.
However, as China’s AI ecosystem strengthens, it may also accelerate the development of domestically produced processors, alternative software platforms, and more efficient models that require fewer Nvidia GPUs.
China remains of particular importance as U.S. export controls limit NVIDIA’s ability to sell cutting-edge chips to the market.
The central question for investors, therefore, is whether China’s improved AI capabilities will expand the global market for computing or strengthen a rival hardware ecosystem that will gradually erode Nvidia’s influence.
Nvidia’s biggest customer is also developing rival chips
Nvidia also faces increased competition from some of its largest customers.
Alphabet continues to expand its Tensor Processing Unit business, while Amazon, Microsoft, Meta, and other technology companies are developing custom accelerators for training and inference workloads.
OpenAI has also been pursuing custom chip projects as AI developers seek to reduce their reliance on Nvidia products and better manage computing costs.
It’s unlikely that these internally designed processors will replace Nvidia’s complete platform in the near future.
Nvidia’s advantages extend beyond GPUs to networking, systems, software libraries, developer tools, and the widely adopted CUDA ecosystem.
However, custom chips can be a big part of specific workloads, especially inference tasks where customers can optimize the hardware for their own models and data centers.
The risk is not necessarily that Nvidia loses its leadership position.
Rather, increased competition could lead to a gradual erosion of pricing power or a decline in the proportion of hyperscalers’ capital expenditures going toward Nvidia hardware.
Japan deal expands Nvidia’s physical AI opportunities
While investors focus on competition and spending risks, Nvidia continues to expand beyond traditional cloud data centers.
CEO Jensen Huang’s recent visit to Japan resulted in several partnerships covering national AI infrastructure, robotics, manufacturing, self-driving vehicles, and semiconductor supply chain.
Nvidia has announced that it is working with Noetra to build what it says is the world’s first national infrastructure dedicated to physical AI.
The planned Vera Rubin AI Factory will feature 13,750 Vera CPUs and 27,500 Rubin GPUs to support AI applications across manufacturing, healthcare, logistics, communications, and robotics.
Japan’s leading robotics and industrial companies are also building on Nvidia’s Cosmos, Isaac, Metropolis, and Jetson platforms.
Participating companies include major manufacturers such as Fanuc, Yaskawa, Kawasaki Heavy Industries, Fujitsu, Hitachi, NEC, Sony, Softbank, and Kubota. These companies plan to use Nvidia technology to develop intelligent robots, autonomous machines, digital twins, and factory automation systems.
The partnership supports Nvidia’s assertion that the next phase of AI growth extends beyond chatbots and cloud models to machines that interact with the physical world.
Factories, vehicles, warehouses, robots, and industrial systems are likely to become new major sources of demand for Nvidia hardware and software.
Record growth continues despite market concerns
Nvidia’s recent performance continues to be very strong.
The company reported a record first-quarter revenue of $81.6 billion, up 20% from the previous quarter, as demand for high-speed computing and AI infrastructure continued to grow.
Market estimates put second-quarter revenue at nearly $91 billion, representing about 96% year-over-year growth.
These forecasts show why many analysts remain positive despite the stock price correction.
Nvidia continues to benefit from the growing demand for AI training, inference, sovereign AI infrastructure, cloud computing, networking, robotics, and autonomous systems.
But expectations are very high.
Strong earnings alone may not be enough to boost stock prices if investors believe future growth will be slower, or if capital spending is increasing faster than earnings.
NVDA Technical Analysis: $200 becomes a major support level
From a technical perspective, Nvidia’s 4-hour chart is mixed but increasingly fragile.
NVDA is trading below most short-term and intermediate-term moving averages, with immediate resistance concentrated between $204.50 and $207.60.
This area includes the 20 EMA, 20 SMA, 30 EMA, 50 EMA, 100 EMA, VWMA, Hull Moving Average, 10 EMA, and 10 SMA. Since the number of indicators is concentrated in this range, $205-208 will be the first major recovery barrier.
Above that, the next resistance level will be the 100 SMA near $210.01. A sustained break above $210 would suggest an improving short-term structure and buyers starting to regain control.
The immediate support zone is between $198.50 and $201.
The 200 EMA of $200.58, 200 SMA of $198.68, and 30 SMA of $201.77 all indicate buy signals. The Ichimoku reference line near $202.48 also places the current price at an important technical inflection point.
If NVDA holds the $198-200 area, the stock could continue to consolidate before another attempt to regain $205-210.
A decisive break below $198 could weaken the broader setup and expose the stock to a deeper decline toward $195 and then the $190-$192 region.
Momentum indicators remain neutral overall, but are slightly bearish.
The RSI is 46.94, indicating neither overbought nor oversold conditions. Momentum and MACD are flashing sell signals, but ADX at 19.16 indicates a lack of strong directional conviction in the current trend.
This suggests that NVIDIA is not confirmed to be bankrupt, but rather has strengthened its core support.
What investors should pay attention to next
Nvidia remains the dominant supplier of advanced AI computing infrastructure, but the market is starting to evaluate its growth story more critically.
China’s AI models, custom hyperscaler chips, export restrictions, and uncertainty about future capital spending all pose risks to the company’s exceptional growth trajectory.
At the same time, Nvidia’s expansion into sovereign AI, industrial automation, robotics, and autonomous systems shows that the company’s addressable market continues to expand beyond traditional data centers.
For now, the $198-$200 support zone is the most important technical level to watch.
A rally above $205-$210 would strengthen the near-term outlook, while a break below $198 could signal further continuation of the broader semiconductor correction.
The next big move for NVDA stock will depend on whether upcoming earnings results from big tech companies confirm that spending on AI infrastructure is strong enough to offset rising competition and valuations.
Aishwarya Gopan
Financial Writer and Editor – Asia & Europe Desk
Aiswarya Gopan is a financial journalist, editor, and content strategist with over 19 years of experience in financial markets, fintech, blockchain, and technology. She has worked with major cryptocurrency exchanges such as BingX and KuCoin to drive content strategy, market research, and editorial initiatives covering digital assets, DeFi, Web3, and global financial markets. With a background in cybersecurity, technology journalism, and market research, Aiswarya specializes in translating complex financial and blockchain developments into clear and timely insights. FX Leaders covers cryptocurrencies, stocks, forex and macroeconomic trends during the Asian and European trading sessions.
