Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun

By: Nadeem_Walayat

Nvidia has gone nuts! EGF's are very strong at +44% and +84%, too strong! Discounting too much growth. I know Nvidia well and yes there is very high demand for their AI Chips, but many of their most recent GPU releases i.e. the RTX 4070 and RTX 4060Ti are POOP in terms of price per performance i.e. one is better of buying last gen than their most recent releases. And then we have the 127X P/E ratio for a stock trading on a market cap of $967 billion! So I sold 12% at $383, and I am now just 2% invested.

What if NVDIA does not correct from here? 600 next?

Could just as easily say what if $140 next? At $600 would carry a heavy premium of X200 earnings, risking all on a gamble, I go for less risk - Qualcom on X10 earnings. That's the point of a portfolio, rather than one single stock or etf, there are plenty of fish to catch, Nvidia delivered well over X3 from its low, not going get greedy and see most vaporise.

You want to buy stocks when they are HATED not when the herd is FOMO-ing into them, that's the time to SELL! Though as you can see it is near impossible to go against FOMO for most. Even after it's bubble pops most will keep buying Nvidia only to bail at say $190, when I'll be buying and get asked, why buy at $190 when it could go to $140 or lower, seen such play out countless times.

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By Nadeem Walayat

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Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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