Nvidia's return to China pushes shares toward 180 level

NVIDIA shares have been hitting all-time highs consistently in recent days, and yesterday’s trading session was no exception. The stock broke through the 170 level for the first time and held firmly above it, paving the way for the bulls’ next target at the 180 level. Technically, the stock is showing signs of being overbought, but any potential correction appears likely to remain contained within the uptrend. Given the shifting market sentiment, demand for NVIDIA will probably remain strong.

The company announced yesterday that it will soon restart sales of its H20 AI chips in China. CEO Jensen Huang had repeatedly urged Donald Trump to lift the restrictions imposed in April, arguing that NVIDIA risked missing out on major opportunities in the Chinese market. According to the corporation’s estimates, maintaining the ban could have led to up to $15 billion in lost revenue.

Huang, currently visiting China, welcomed the decision made by US authorities. He stated that China’s AI models are already highly advanced, but will require vast computing power to scale further. Next year, the Asian country will need $50 billion worth of chips, and NVIDIA expects to meet a large portion of that demand. The company also unveiled a new chip designed specifically for the Chinese market, the RTX Pro GPU, which will comply with US export restrictions.

According to Reuters, the return of the H20 chips has set off a buying spree in China, with major players like ByteDance and Tencent already placing orders. In 2024 alone, NVIDIA’s sales in the Asian market hit $17 billion, accounting for 13% of its total revenue, and these numbers could climb even higher if Washington and Beijing finalize a trade deal. Now, as part of the bargaining process, the US is pushing for a key concession from Beijing—the resumption of rare earth metal exports.

NVIDIA's RSI is heavily overbought on the daily chart, signaling a likely pullback. This could present a great buying opportunity ahead of a potential surge toward the 180 level.

Consider the following trading strategy:

Buy NVIDIA in the range of 165–170. Take profit – 180. Stop loss – 160.