Buying NVIDIA shares with $195 in view

Yesterday, the US Retail Sales report for August was released. The non-inflation-adjusted figure rose by 0.6% after a similar increase in July. The so-called Retail Sales Control Group data, which are factored into Gross Domestic Product (GDP) calculations, gained 0.7%, reflecting strong second-quarter results.

Corporate earnings forecasts keep rising, while consumer spending remains stable. If these favorable conditions persist, the stock market may continue to show good performance, even if it takes a breather for a while. Despite the positive retail sales report, there was another factor behind a recent rally in the US stock market. The surge was driven by expectations of six rate cuts by the Federal Reserve (Fed) within twelve months.

As a confident leader in the US stock market, NVIDIA keeps climbing higher. The firm is in the S&P 500 top ten for companies with the highest annualized dividend growth rate. In tandem with its market capitalization, NVIDIA is a clear front-runner. Its shares traded flat for a couple of months, then slightly dropped, and are now poised to rebound strongly. Technical indicators support this scenario, as the current price on the daily chart remains above the 50-day and the 200-day moving averages.

The overall recommendation is to buy NVIDIA. Profits should be taken at the level of $195.0. Stop Loss could be set at $155.0.

The volume of the open position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance does not allow opening a position of this size, it is better to avoid entering the market on this signal and wait for other trade options that meet low-risk criteria.