To The Moon

"Buy the rumor, sell the news" describes a trading adage where stock prices climb based on speculation before an event, then drop once the official news breaks.

Because markets are forward looking, investors buy early on anticipation.

When the announcement happens, these buyers take their profits, causing the price to fall as selling outweighs new demand.

With that let me share the rumours on $NVIDIA(NVDA)$ for your considerations.

The Peak.

NVDA hit an all-time high (ATH) on 14 May 2026 at $235.74 per share.

Since then, it has lost roughly $1 trillion in market value. (see below)

The stock is down about -10.92% from that peak, trading around $210 (as of Fri, 10 Jul 2026), while the broader market has mostly moved higher.

For investors who bought in during the Spring run-up, it has been a rough 2 months with no clear catalyst to point to.

The Analyst.

On 08 Jul 2026, $Citigroup(C)$, Analyst, Atif Malik, who has covered NVDA thru’ most of its AI-era rise, published a note after speaking with NVDA’s investor relations team.

Analyst Credentials - Atif Malik, ranked number 3 out of more than 12,000 analysts tracked by TipRanks with an 81% success rate.

His message was unambiguous:

• The concerns driving NVDA selloff are real and this is something beyond NVDA’s control.

• However, its product roadmap is intact.

• Equally important, NVDA is cheaper than it has been in years.

• For that, he reiterated a “Buy” rating and kept his $300 price target in place.

With NVDA closing at $210.96 (as of Fri, 10 Jul 2026), his target implies a +42.2% upside.

His conversation with NVDA’s investor relations team addressed specific issues weighing on the stock:

The Schedule.

• Firstly, NVDA’s product roadmap is fully intact. That includes the next-generation Kyber chip line. There are no significant delays.

• Concerns circulating about supply chain disruptions & product timelines do not appear to be grounded, as confirmed by NVDA’s IR team.

• Secondly, NVDA’s NVLink networking interconnect & its optics plans, that have been the subject of investor questions, remain on schedule, too.

The Profitability.

• On margins, NVDA’s IR team told Malik that long-term memory deals it has in place should protect gross margins from the kind of pressure, some investors feared.

• According to Yahoo Finance, NVDA is maintaining a mid-70s gross margin target.

• For a company of NVDA’s scale and growth rate, holding margins there while revenue keeps expanding is meaningful.

NVDA - 13 Apr - 11 Jul (3 months)

The Valuation.

The two-month selloff has done something unusual to NVDA’s valuation:

• It is now trading at roughly 18x -19x forward earnings.

• Its NVDA’s lowest multiple since early 2019, back when NVDA was still thought of primarily as a video game chip and bitcoin mining play.

The Analyst’s View.

Malik views NVDA as an opportunity:

• The correction started in mid-May 2026 when investors began rotating into memory chips like $Micron Technology(MU)$ and $SanDisk Corp.(SNDK)$ .

• The rotation has pulled money out of NVDA without anything fundamentally changing at the company.

• The business that was worth ATH prices in May 2026, has not changed but sentiment has.

Separately, as reported by TheStreet, on 08 Jul 2026, $Bank of America(BAC)$ made a similar valuation argument on NVDA.

Its analyst Vivek Arya set a $350 price target on NVDA.

Both Citibank & BofA are pointing at the same thing, ie. NVDA’s stock is trading like the AI story is over at a moment when the company’s own pipeline suggests it is not.

The Buybacks & Cash Return.

NVDA’s IR team also touched on capital return:

• The company repeated again its goal of returning 50% of cash flow to shareholders in 2026.

• So far. it has raised its dividend to $0.25 per share from $0.01 earlier this year.

• NVDA has also announced a new $80 billion stock buyback program on 20 May 2026. (see below)

• This will be on top of an existing $39 billion authorization that still has room to run.

• Management also expects to increase share buybacks further down the road, given current valuation of the stock.

With NVDA down -10.92% from its ATH, any aggressive buybacks could help stop the price from falling further while reducing the total number of shares available, at the same time.

It is widely recognized that companies that buy their own stock at low prices usually create much bigger returns for the remaining investors when market sentiment improves.

The Investors’ Concerns.

Malik did not dismiss the bear case and addressed it directly in his notes as well.

In short, investors’ concerns center on 3 things:

(1) Hyperscalers’ capex.

On whether AI capex by MSFT, GOOG & AMZN will slow down, Malik’s read is AI investment is not peaking. It is continuing to compound.

NVDA’s own data center saw revenue grew roughly +75% in its most recent quarter, evidence that customers are not pulling back.

That is not the growth profile of a company whose customers are pulling back.

These multi-billion dollar investments are expected to deliver long-term returns as AI infrastructure continues to drive cloud revenue

(2) Competition.

On whether custom AI chips from $Broadcom(AVGO)$ and others are gaining enough ground to threaten NVDA’s dominance.

Malik acknowledged that the custom silicon market is growing but maintained that NVDA’s dominance in training workloads remains intact.

Meaning - GPUs are still the default for model training, and NVDA leads that market by a wide margin.

Inference is where custom chips have made more headway, but NVDA has been building out its inference capabilities as well.

Malik expects NVDA to maintain its leadership across both AI training and reasoning-focused inference.

He believes the overall AI compute and networking market is growing so rapidly (potentially to $2 trillion by the end of the decade) that NVDA will remain the core secular winner.

(3) Memory Chips Rising Costs.

Rising costs for high-bandwidth memory (DRAM) are feared to squeeze NVDA’s profit margin.

To that, Malik maintained that NVDA has strong access to DRAM memory despite industry-wide supply constraints.

He projected that gross margins will remain robust, reaching roughly 75% for FY 2027, suggesting NVDA will be able to effectively manage the cost pressures.

Bonus !

(4) The Non-Investors’ Concern.

In addition, Malik has thrown in a potential China upside that is not on investors’ radar. (see below)

On 8 Jul 2026, it was reported that NVDA’s H200 chips could re-enter the Chinese market under strict export controls.

So far, Malik’s estimates do not include China.

If Chinese restrictions ease, it represents (for now) finite revenue upside. How so ?

According to the report, Beijing is considering approving fewer than 200,000 H200 chips, that is less than half of what companies had requested earlier in 2026.

Optimistically, at least the door to the Chinese market is ajar versus it being shut tight altogether.

Also, who is to say that China might not relax the rule subsequently if & when tension between the 2 countries further eases, depending on how US plays the diplomatic game instead of being xenophobic.

The Summary.

Nvidia’s Q2 2027 earnings report is scheduled for Wed, 26 Aug 2026.

Between now and then, NVDA will trade on sentiment, news flow, and whatever the broader market does with AI-related names.

Malik’s note is not a near-term trading call.

It is a fundamental argument that the selloff has created a valuation entry point for investors willing to look past the noise.

According to Yahoo Finance, NVDA is signaling a potential breakout from its multi-week correction as.

Whether that holds will depend on whether concerns driving the selloff (a) continue to fade or (b) new ones emerge ahead of its August 2026 earnings reporting.

For investors who have been watching from the sidelines since May 2026 high, Citi is essentially saying the ‘buying’ window may not stay open indefinitely.

The product roadmap is intact, (i) margins are holding, (ii) buyback program is in place, and (iii) valuation is the cheapest it has been since before anyone had heard of ChatGPT.

Sidetrack:

I disagree with Malik’s last statement made because NVDA’s soaring price was all thanks to ChatGPT.

Before ChatGPT reveal on 30 Nov 2022, NVIDIA was navigating a massive post-pandemic tech slump and crypto crash.

In October 2022, its split-adjusted stock price hit a low of roughly $11.28. Post ChatGPT reveal, NVDA was trading quietly at around $16.91.(see below)

NVDA - past 5 years

As ChatGPT became the fastest-growing consumer application in history, tech giants scrambled to buy tens of thousands of NVIDIA GPUs to build competing models.

By early 2023, the stock took off vertically, comfortably crossing $20.00 by February 2023 and continuing its massive rally to over $200.00. (see above)

When reading any post, it is important to have a questioning mind so as not to be misled.

The Technical Analysis.

While I like to take Malik’s views and argument wholesale, I think it would be prudent to take a look at NVDA’s technical indicators to see if they are aligned to analysts’ opinions.

For that, I turn to NVDA’s 12 months indicators of (a) Moving Averages (MA) of 20-day, 50-day & 200-day, (b) MACD and (c) RSI. (see above)

(1) Moving Averages (MA).

• On Fri, 10 Jul 2026, NVDA ended the week at $210.96 per share.

• This is above its MAs of 20-day ($201.95), 50-day ($210.09, barely scrapping by) and 200-day ($191.67).

• This implies stock is bullish bias and each MA acting as a potential support line, should the stock corrects.

Broader sector trends (especially semiconductors and AI enthusiasm) will heavily influence whether this trajectory continues.

(2) MACD.

• Both the MACD line (7.64) and Signal line (6.96) are above the Zero line, indicating that NVDA’s medium‑term momentum remains bullish.

• When MACD stays positive for an extended period, it reflects sustained upward pressure — the shorter‑term moving average (12‑day) is consistently above the longer‑term (26‑day), confirming trend strength rather than a short‑lived rally.

• The MACD line above Signal line (difference = +0.68) shows a positive crossover — a classic buy‑side momentum signal.

• This suggests that bullish momentum is accelerating, as the faster‑moving MACD line is pulling away from the slower signal line.

• Traders often interpret this as confirmation that uptrend is gaining traction.

• Lastly, a positive divergence (+0.68) means momentum is strengthening.

• If divergence continues to widen, it implies increasing buying pressure. Conversely, if it starts to narrow, it could hint of (i) early exhaustion OR (ii) consolidation ahead.

(3) RSI.

• With NVDA’s 14-day RSI coming in at ““ An RSI reading of 78.77 for NVDA is quite telling — it’s deep into the overbought zone, which starts around 70 on the 14‑day scale.

• Since NVDA’s MACD is positive & rising, the RSI strength aligns with momentum, confirming the uptrend rather than contradicting it.

• However, if latest Middle East tension is factored in, near term pause or correction is not impossible.

The Next Step.

In summary, Malik’s case is that all of the mentions together add up to a “Buy”, not a “Wait”.

Is it wiser to see how Trump is going to manage or mis-manage the Middle East situation before considering investing ? What will you do ?

Remember to check out my other posts. (See below). Help to Repost ok, Thanks.

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• Do you think the Middle East situation needs to get worse in order to bring both sides back to the drawing table ?

• Do you think NVDA is a compelling buy now ?

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