Timing the market is a fool’s errand. But I can’t blame traders for staying away from Nvidia (NASDAQ:NVDA) stock.
Its share price has increased 17% just in the last month. In 2021, NVDA stock is up over 55%.
Some of the rally was due to the company’s strong first-quarter earnings. And news of Nvidia’s four-for-one stock split, set to take place on July 19, is also driving interest in NVDA stock.
Conventional wisdom states that even the best stocks don’t always go up. Nvidia appears to be headed down now. Consequently, traders may be wise to take some of the profits they’ve made on the shares.
And as they do, bullish investors should wait for the right time to buy the dip, since the stock will eventually power higher.
Drown Out the Noise
The proliferation of traders in the stock market is exciting, and I believe that, in the long-run, it will be a net positive for most market participants. It’s not surprising, though, that much of the mainstream financial news coverage is now geared towards providing actionable trading advice.
I’m not an expert on technical analysis, but I can see that the chart of NVDA stock doesn’t look favorable.
And with a stock that’s climbed about 110% in the last 12 months, the easy gains look to be gone. But in the eyes of investors, NVDA stock still seems attractive. The shares’ outlook depends on the beholder’s perspective and objective.
Nvidia Will Touch Many Areas of the New Economy
Technology is a remarkable thing. It makes so many aspects of all of our lives easier. And as the Internet of Things and artificial intelligence expand, the possibilities will only continue to grow.
Many of these technological innovations require the kind of chips and products that Nvidia provides. That is why NVDA stock will continue to be a buy for long-term investors.
From gaming systems and data centers to electric vehicles and cryptocurrencies, Nvidia products and services will be playing a significant role in the hottest sectors of our economy in the future.
And the reality is that many of these sectors are not going to be flashes in the pan. Instead, they will require continuous investments, and new technologies will have to advance along with them.
That, in a nutshell, is the reason that I’m bullish on NVDA stock. It’s going to have its share of ups and downs. But investors who hold this stock for the long-term will be rewarded for their patience.
Think About the Future, And Buy NVDA Stock
Getting back to the premise of my headline, NVDA stock is a long-term winner that will likely undergo a short-term correction.
If you’re a trader, you probably know what you need to do. However, if you’re still puzzled, I’d suggest diving into the articles of other InvestorPlace writers who provide trading suggestions in general and advice on options trading in particular.
If you’re more of the buy-and-hold type, now is a good time to hold NVDA stock. If the price goes up, you can buy the shares after they split (if nothing else, they will be cheaper on a per-share basis ). Meanwhile, you won’t have to sweat a correction. And you’ll even collect a small dividend.
On the date of publication, Chris Markoch did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris Markoch is a freelance financial copywriter who has been covering the market for seven years. He has been writing for InvestorPlace since 2019.
