Yesterday, NVIDIA experienced a historic loss, with a nearly 17% drop in market capitalization, wiping out $589 billion in a single day. This plunge followed the announcement by the Chinese startup DeepSeek, which launched a low-cost AI model, challenging NVIDIA’s dominance in the artificial intelligence market. This news triggered a massive sell-off in tech stocks, leading to a 3.1% drop in the Nasdaq.
DeepSeek made a bold move with a free and highly efficient AI assistant, already surpassing ChatGPT in downloads on the App Store. While this innovation has shaken the market, NVIDIA remains a key player, as many cloud service providers and data centers continue to rely on its chips. Today, NVIDIA’s stock showed signs of recovery, climbing 4.8% in pre-market trading.
From a technical perspective, NVIDIA’s monthly support level is holding for now. The upcoming January close will be crucial to confirm whether the stock is set for a recovery or a further decline. These movements can offer important insights into what lies ahead, but caution is key.
Disclaimer: This is not financial advice, just my personal opinion shared for informational purposes only. Always do your own research before making any financial decisions!