Nvidia Death Cross Has Traders on High Alert as Momentum Withers

Nvidia Corp. (NVDA) investors, who are used to big announcements and soaring stock prices during the company’s annual GTC conference, were left underwhelmed this time. With few new catalysts and growing macroeconomic concerns, analysts are warning of further downside risk for the AI chip giant.

Stock Slump Signals More Trouble Ahead

Nvidia shares fell over 2% on Friday, capping a 4% weekly decline. So far in 2025, the stock is down 13%. Adding to the bearish sentiment, Nvidia’s 50-day moving average slipped below its 200-day moving average this week, forming a dreaded “death cross” pattern. The last time this occurred, in April 2022, Nvidia stock plunged over 30% in two months.

“It’s got a lot of negative momentum,” said Larry Tentarelli, founder of Blue Chip Daily Trend Report. “Nvidia is a very difficult chart.”

AI Spending Jitters and DeepSeek Fears

Despite solid fundamentals and one of the lowest P/E ratios in years, Nvidia faces skepticism about its future AI growth. Investors are worried about:

China’s DeepSeek competing in the AI space
President Donald Trump’s tariff threats adding uncertainty to global trade
The possibility of hyperscalers (like AWS, Microsoft) cutting AI spending, which could impact chip demand

An index tracking the “Magnificent Seven” megacap tech stocks is down 15% year-to-date, showing the broader tech sector struggles.

Few Catalysts in Sight

Nvidia CEO Jensen Huang’s keynote at GTC failed to spark new optimism. While the company has promised Q1 revenue of $43 billion, investors want proof that growth will deliver tangible returns soon.

“What the market is saying with Nvidia is, ‘we’re concerned about the economy, we’re concerned about DeepSeek,’” said Tentarelli.

Without upcoming company-specific catalysts, attention shifts to the macroeconomic backdrop, especially April 2, when Trump’s reciprocal tariffs are expected to be announced. This could trigger broader market moves that affect Nvidia.

The Technical View

While some investors are spooked by the death cross, others, like Evercore ISI’s Richard Ross, downplay its significance.

“It shouldn’t make you feel worse about your bull call or better about your bear call,” Ross said.

Nvidia stock remains range-bound, making technical indicators less predictive at this stage.

Nvidia’s near-term outlook is murky. With no major catalysts ahead, all eyes are on macro factors like trade policy and AI spending trends. Investors may need to brace for volatility as the AI boom narrative faces its toughest test yet.

Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.

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