Key Points
- Nvidia shares fell 2.27% to $175.47, despite post-market buying interest
- Alphabet plans to double capital spending to about $180 billion, reinforcing long-term AI infrastructure demand
Nvidia shares eased on Wednesday, closing down 2.27% at $175.47, as traders continued to digest recent weakness in high-growth technology stocks.
The decline came even as Alphabet announced a sharp increase in capital spending, a move that underpins longer-term demand for advanced chips but did little to lift Nvidia decisively during regular trading hours.
Alphabet said it would double capital expenditure this year to around $180 billion, largely to expand data-centre capacity and AI infrastructure.
The announcement sparked a stronger reaction in some of Nvidia’s peers, while Nvidia itself struggled to shake off broader selling pressure that has weighed on the stock in recent sessions.
A cautious forecast suggests that while the spending plans reinforce Nvidia’s structural demand outlook, near-term price action may remain choppy as traders reassess valuation and positioning.
Alphabet Spending Highlights Nvidia’s Strategic Role
Despite Google’s growing use of its own in-house AI accelerators, Nvidia remains a critical supplier across Alphabet’s ecosystem.
Google Cloud continues to rely on Nvidia GPUs for AI training and inference services offered to enterprise clients, while Nvidia hardware still supports key elements of Google’s internal data-centre operations.
The scale of Alphabet’s planned investment underscores the pace at which AI workloads are expanding.
Even with greater deployment of custom TPUs, the overall growth in compute demand supports continued reliance on Nvidia’s high-performance chips, particularly for advanced and flexible AI tasks.
This backdrop explains why Nvidia saw buying interest after hours, even as broader market sentiment stayed cautious.
Mixed Sentiment Weighs on Short-Term Momentum
Market sentiment around Nvidia remained subdued, with traders balancing long-term optimism against near-term concerns.
Stocktwits data showed neutral sentiment, reflecting hesitation following recent headlines related to Nvidia’s China business and export uncertainty.
The stock has already come off recent highs, and some traders appear reluctant to add exposure ahead of clearer signals on earnings momentum and regulatory developments.
This contrasts with the more enthusiastic response seen in Broadcom, which benefits directly from Google’s networking and custom chip requirements.
A cautious near-term view points to continued consolidation unless fresh catalysts emerge to reset expectations.
Technical Analysis
NVIDIA (NVDA) is currently trading at $175.47, down 2.27% (-4.07) in the session, as it struggles to recover from an extended downtrend. After peaking near $194.43, the stock has steadily lost ground, with sellers dominating across multiple sessions.
The sharp decline accelerated after the break below $183, dragging prices down toward a session low of $171.87. This support area saw a modest bounce, but so far the upside remains limited, and the overall trend is still downward.
Short-term moving averages (MA5: 175.18, MA10: 174.68, MA20: 174.43) are now clustering around the current price, hinting at potential consolidation.
Volumes remain muted compared to the heavy selling earlier in the chart, suggesting that while downside pressure has eased, conviction on a bullish reversal is still weak.
The brief recovery to $175.57 could act as a short-term resistance, with price needing to convincingly break above $178–180 to change the broader trajectory.
For now, the stock is attempting to stabilise, but any further breakdown below $171.87 could open the door to test the $170.00 psychological level. Traders should watch for volume confirmation and MACD crossover signals to gauge whether this bounce has legs.
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