Nvidia Crashes Below $171 Support—AI Hype Shows First Real Crack Since May

Nvidia’s stock just did something it hasn’t done since spring: buckle under pressure. The $171 floor—once a surefooted stepping stone for the AI darling—gave way as the sector’s feverish rally cools. Turns out, even silicon prophets need oxygen.

Wall Street’s latest reality check

The chip giant’s stumble marks a sobering moment for the AI trade. After months of gravity-defying gains, investors are finally asking if the hype has outrun the hardware. Nvidia’s GPUs may power the future, but today they’re struggling to prop up its own valuation.

Finance’s eternal lesson repeats itself: what goes up must consolidate—or as the suits say, 'reprice to fair value' (read: until our next narrative pivot).

Traders eye $160 as next key level for Nvidia

Buff Dormeier, the chief technical analyst at Kingsview Partners, said Tuesday’s close below the 50-day average is a clear sign things are slowing down. “This shows how the momentum has broken down, and it makes me concerned about the stock over the short term,” Buff said.

He’s now watching $160 as the next support, and if that fails, it’s $145, the same level where Nvidia bounced back in June. “If it breaks under $145, I’d be really concerned about its prospects,” Buff added.

The selloff didn’t just hit Nvidia. The entire equity market came under pressure, with investors worrying about global tension and bloated tech valuations. That combination made it easier for fund managers to rotate out of high-flying AI stocks. Nvidia was a natural target. Despite recent gains, the stock has gone nearly vertical this year, making it vulnerable to even the slightest negative trigger.

And that trigger came fast. Last week’s earnings guidance didn’t deliver the confidence Wall Street was hoping for. Analysts didn’t panic, but the tone definitely changed.

Many are still forecasting over 25% upside based on average price targets, but no one’s pretending like the next leg up is guaranteed. As Buff put it, “There’s still long-term opportunity, but it seems like it has peaked for the short or intermediate term.”

China builds its own AI chips as Nvidia faces pressure from both sides

While Nvidia struggles to hold investor trust amid the rapidly growing AI market, China is pushing hard on its AI Plus plan, which will supposedly embed artificial intelligence across nearly every industry by 2030. This is backed by massive investment into homegrown chips, high-bandwidth memory, and a nationwide supercomputing buildout.

Leading that effort is Cambricon, a local chipmaker that’s calling itself China’s Nvidia alternative, but Beijing doesn’t need Cambricon’s Siyuan chips to beat Nvidia’s Blackwell Ultra.

What it wants is “good enough” tech that can support the country’s AI ambitions without relying on U.S. suppliers. The country’s political class isn’t chasing performance. It wants control. And Cambricon gives it just that.

That puts Nvidia in a nasty spot. The company is caught between Washington’s export restrictions and China’s push for chip independence. Trying to keep both sides happy is backfiring.

Nvidia’s now serving two masters and satisfying neither, a problem that’s only going to get harder as the tech war and geopolitical pressure continue.

Get $50 free to trade crypto when you sign up to Bybit now