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SCOTT LEHTONEN

Magnificent Seven Stock Nvidia In Buy Zone After Bullish Support At Key Level

Artificial intelligence leader Nvidia, one of the Magnificent Seven stocks, is Tuesday's pick for IBD 50 Growth Stocks To Watch. Nvidia stock is in a new buy area after a bullish rebound from a key support level. That makes NVDA one of the best stocks to buy and watch in today's market.

Nvidia's 2023 success placed the graphics-chip maker on IBD Leaderboard.

In the latest quarter, reported Nov. 21, Nvidia earnings skyrocketed 593% to $4.02 per share vs. the year-ago period. Sales surged 206% to $18.12 billion.

Analysts expect the company to earn $12.26 per share for its 2024 fiscal year ending Jan. 30. That profit will further expand to $20.70 per share in fiscal 2025, according to FactSet.

At the end of November, the company expanded its push into AI.

NeMo Retriever — a new offering in the Nvidia NeMo family of frameworks and tools for generative AI models — helps organizations enhance their generative AI applications. NeMo Retriever helps generative AI applications provide more accurate responses through Nvidia-optimized algorithms.

Thanks to the company's long-term profitability and big earnings gains in recent quarters, Nvidia has a best-possible 99 Earnings Per Share Rating, according to IBD Stock Checkup.

NVDA stock also boasts a perfect 99 IBD Composite Rating following a tremendous stock move in 2023.

Learn How To Time The Market With IBD's ETF Market Strategy

Nvidia Stock In Buy Zone

The AI giant is in buy range from a double bottom's 476.09 buy point. NVDA also found support at the 50-day moving average earlier this month, according to IBD MarketSmith chart analysis. The 5% buy area runs up to 499.89. Nvidia stock slid nearly 2% Tuesday afternoon.

Meanwhile, Nvidia stock is close to forming a new flat base, which would offer an additional entry at 505.48. The current base is only four weeks long. The minimum length of a flat base is five weeks, which could be reached at the end of this week.

A key technical metric to watch is the relative strength line. NVDA stock's RS line is approaching new highs. That's a sign of long-term stock market outperformance. The RS line hit a new high in the direct aftermath of the Nov. 9 breakout, reiterating the stock as a market leader.

With the stock market outlook in a confirmed uptrend, investors have the opportunity to raise market exposure through buying stocks making strong breakouts. And Nvidia stock deserves a look.

Best Stocks To Buy And Watch

Three recent IBD 50 Growth Stocks To Watch picks are among the best stocks to buy and watch, along with Nvidia stock.

Company Symbol  Buy point Type of base
Royal Caribbean 112.95 Cup base
Snowflake 192.66 Cup with handle
Microsoft 366.78 Cup base
Source: IBD Data As Of Dec. 19, 2023

Follow Scott Lehtonen on X/Twitter at @IBD_SLehtonen for more on the best stocks to buy and watch and the stock market.

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