Apr. 15 – NVDA “Trading Strategies Under the $5.5 Billion Hit: Technical Windows Amid Bad News”

Apr. 15 – NVDA

“Trading Strategies Under the $5.5 Billion Hit: Technical Windows Amid Bad News”

After the bell today, NVIDIA (NVDA) announced in an investor filing that it expects to incur a $5.5 billion charge this quarter due to newly imposed U.S. government export restrictions on its H20 AI chips. The restrictions require an export license for shipping these chips to certain regions—a license that, according to market consensus, will be extremely difficult to obtain. (Notably, the H20 is the primary chip used by DeepSeek.)

As a result, NVDA shares plunged more than 6% in after-hours trading, triggering a broad selloff in the semiconductor sector, with TSMC down 3%, Broadcom down 4%, and AMD nearly 8% lower.

According to the filing, the $5.5 billion charge consists primarily of write-downs on inventory prepared for the China market and cancellations of related procurement agreements. The H20 chip was initially designed specifically to circumvent a previous round of restrictions—making this regulatory update a significant blow. With H20 likely removed from the Chinese market, local alternatives such as Huawei may take its place.

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Technical Setup & Strategic Response: Trading the Panic Sell-off

Despite this negative news, NVIDIA remained the top net institutional buy among the “Magnificent 7” over the past three trading sessions, followed by Tesla (TSLA) and Microsoft (MSFT). This suggests that smart money has not exited the name—in fact, it may be accumulating on dips.

Here are two potential tactical setups to consider for tomorrow’s session:

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1. Watch $105: The First Key Technical Pivot

If NVDA opens below $105, monitor the price action closely for the first 30–60 minutes.

• A sharp recovery back above $105 could indicate a “panic flush & reclaim” setup.

• If $105 holds as support, this may mark the start of a “climb the wall of fear” rebound.

Holding the $105 level is structurally important and could provide the base for a technical rebound.

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2. Upside Repair Zone: $125–$130

Should NVDA rebound and break above the April 9 high, the $125–$130 zone becomes a key repair target. This area aligns with a previous volume cluster and serves as an important resistance band.

• A breakout here would require volume confirmation and an improvement in broader risk sentiment.

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3. Conservative Approach: Wait for Downtrend Breakout Confirmation

For risk-averse traders, consider waiting for a confirmed breakout above the daily descending trendline before entering. This trend-following setup offers greater reliability and is better suited to position traders seeking confirmation.

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Conclusion: Is There a “Structural Opportunity” Hidden in the Bad News?

While the escalating U.S.–China tech tensions present clear short-term headwinds for NVIDIA, the technical landscape still offers potential asymmetric opportunity—especially if the $105 support holds and institutional flows remain supportive.

The real question isn’t just the bad news—but how the market responds to the bad news.

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Key Takeaway:

• Watch the $105 support level closely;

• Look for signs of volume reversal, technical reclaim, or failed breakdowns;

• Tactical opportunities may exist if the panic proves to be over-discounted.