Mean reversion beckons for NVDA and Cocoa

March 26, 2024 Leave a comment

The two most notable parabolic price moves in recent times is being seen in the price of Cocoa and NVIDIA shares.

Both prices are trading at stratospheric percentages above their 200 week moving averages.

Cocoa is trading 3.5 standard deviations above its rolling monthly mean and even more astonishing, at US$9,950 per ton, it is more expensive than Copper which is trading at US$8,870 per ton.

Mean reversion or mean convergence?

Gravity is real.

Screenshot

Screenshot

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Tech Wreck ??

September 12, 2023 Leave a comment

The study below reminds me which atmosphere stocks such as Nvidia (NVDA) are trading within.

It can be useful to those who use words such as “momentum” or “break-outs” as reasons for their investment or speculation decisions.

This study can also be applied to a bunch of the fabled tech darlings.

Keep in mind that mean reversion is a real thing.

What if NVDA’s stock price fell to $240?

While I see demand in certain industries and products, I’m also warning that valuations matter and the world won’t always need a new gadget let alone do we need another subscription software service.

I doubt that productivity, convenience or joy can be increased commensurately.

The second attached study features the Nasdaq 100.

September 12, 2023

by Rob Zdravevski

rob@karriasset.com.au

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Nvidia in rare air again

May 25, 2023 Leave a comment

The chart below shows the percentage that Nvidia (NVDA:US) is trading above its 200 week moving average.

In 2002 I wrote of Nvidia’s stretched price action and how mean reversion beckoned.

Then in his note below highlights the decline the stock should make as it was heading towards its 200 week moving average.

Another FANNGM is doing it

Since that mean reversion, we’ve seen another parabolic price move.

While it’s a stupendous result for those who accumulated the stock down near that $120 level, I’m miffed by the motivations of the buyers in today’s market with the stock in the $380 price region.

The law of large numbers also comes to mind as Nvidia approaches a market capitalisation of $800 billion.

Caveat Emptor !

May 25, 2023

by Rob Zdravevski

rob@karriasset.com.au

Filed under Finance & Investment Tagged with , ,