Nvidia (NVDA, Financial) achieved a significant milestone as its stock price closed at a record high. Investors were keenly buying in anticipation of CEO Jensen Huang's keynote address at CES, where he outlined a bold vision for AI's future. Huang emphasized the potential of AI technologies like ChatGPT and highlighted partnerships with major automakers, such as Toyota (TM) and Volvo, using Nvidia's DRIVE Hyperion platform to advance autonomous vehicle technology.
Huang explained that manufacturing self-driving cars requires three computers: one for training, one for simulation, and one inside the car, with Nvidia powering all these systems. Despite Nvidia's ambitious vision, its stock faced a familiar cycle of hitting highs followed by significant sell-offs. This recent trend saw its market value drop by $220 billion, marking the steepest decline in four months.
This trend echoes past incidents, such as in November when Nvidia shares surged past $150 but later fell by 13% after profit-taking, and similar movements in June when a 27% sell-off followed a sharp rise. Nvidia's performance has historically disappointed bulls despite its leadership status in the bull market.
Long-term investors, like Mick Mix, emphasize observing the company's quarterly growth rate. Mix noted that unless growth slows down quarterly, he would refrain from selling Nvidia shares. He remained optimistic about Nvidia potentially reaching a $4 trillion market cap, although he believes it is not an immediate certainty but inevitable over the next few years.
