Video summary
Nvidia is currently experiencing a notable price decline ahead of its upcoming earnings report, breaking through a key support level at 217 to 218 dollars that had held steady throughout August. While the stock has only dropped about half a percent so far, this technical breakdown suggests potential further downside pressure toward the 210 or 212 dollar range before next Wednesday's earnings release. Historically, Nvidia tends to sell off after earnings, but this pre-earnings dip could indicate a setup for a future price increase, though the outcome remains uncertain given the unpredictable nature of market reactions to quarterly results.
Despite the stock's short-term weakness, there is significant positive news regarding China, where major tech giants like Baidu and Tencent have reportedly received shipments of Nvidia's H200 chips. This development marks a crucial shift from theoretical regulatory approval to actual physical deliveries, potentially unlocking substantial new revenue streams that were previously excluded from management guidance due to uncertainty over Beijing's restrictions. Although the scale of these sales is not yet fully reflected in current stock valuations, it demonstrates that Chinese developers still heavily rely on Nvidia's hardware and CUDA ecosystem for training advanced AI models, proving that demand remains robust even amidst geopolitical tensions.
In contrast to Nvidia, Walmart has suffered a dramatic collapse with its stock plunging nearly 10% after reporting mixed earnings results. While the company beat estimates for adjusted earnings per share and total revenue, it missed expectations on comparable sales growth for the first time in over five years, driven by slower customer traffic and higher fuel costs affecting lower-income shoppers. The market reacted sharply to these underlying weaknesses, causing the stock to fall from pre-market highs around 115 dollars down to levels near 104 dollars, raising concerns about whether this decline is a temporary correction or the beginning of a longer-term trend.
The speaker advises caution when evaluating Walmart's current valuation, noting that while the stock has become significantly cheaper after its massive rally earlier in the year, it still feels like a "falling knife" for new investors. However, for long-term holders or those viewing the stock as a core holding, this sharp drop might present an attractive opportunity to add positions once the short-term growth concerns regarding store traffic resolve. The analysis suggests that while immediate buying is not recommended without further research into the full report details, the three-year chart remains healthy, indicating that the current weakness could be a suitable entry point for patient investors who believe in the company's long-term fundamentals.
Read the full video transcript
So, it looks like Nvidia selling off
into earnings. Guys, we have to break
down the charts, what's going on, some
news we got regarding China. And we're
also going to break down Walmart, which
oh my goodness, guys, it is collapsing.
So, we have a lot to talk about. Hit the
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And now, cheers. Take a sip of your
coffee, guys, and let's dive into it.
So, I'm sure you saw my last video.
Every index in the US market's down,
oil's up, Bitcoin's exploding, the VIX
is up, metals are up, everything is up
except for, well, the stock market. And
now Nvidia is down half a percent on the
day. Trading down under or over a dollar
per share, which is not that bad. But
the critical piece of well, I guess
charting that I'm seeing today, is the
fact that we're taking out this key
support. So I don't care that Nvidia is
only down half a percent. Earlier it was
down even more. I care about the fact
that we're taking out 217 at 218, which
has held as support here pretty much all
of August, right? All of August, we've
held 217 218. Now, we're starting to
break through. We have a death cross on
this 1 hour time frame, which is not
great for the uh for the bulls heading
into earnings. But this raises another
question. Is this the pullback that we
would have gotten after earnings? Uh but
we're now getting it before earnings. It
might be. It might be considering uh we
know what Nvidia's been doing. It sells
off after earnings, but maybe maybe it's
now selling off before earnings, setting
up for a potential pop. Maybe. Or one
could hope, right? You know, maybe maybe
it just goes down even more after
earnings, guys. But the point is right
now we're taking out a uh key support in
the very short term. And this could lead
us to slip a little bit more maybe down
to 210 212 before earnings which are
coming out next Wednesday in less than a
week. I'm excited. What about you guys?
Um so we're seeing the selloff
accelerating. I think we have a little
more down downwards um you know pressure
to go here 210 212 and maybe we start to
see consolidation and even start to run
up into that earnings report and then
again historically Nvidia recently at
least has sold off after earnings but
that doesn't mean it has to happen again
who knows this is why I don't trade
earnings guys it's a gamble I don't care
what you see on you know X what you see
on uh you know YouTube, across social
media. Oh, this guy used leverage. Oh,
this guy did that. He's at the end of
the day, they're gambling on earnings.
Nobody knows h how the price action is
going to react, but I know for sure I'm
still long. And I like the developments
we got out of China. Let me cover that
quickly. Um, and we'll break down some
more stocks. Walmart in particular,
which is completely falling off a cliff
right now, guys. It is super ugly. So,
uh, Bite Dance and 10 cent we're hearing
have reportedly received approximately
10,000 H200 chips each, which you guys
know China is a major market. Um, you
know, you know, Nvidia could survive
without them obviously, but they're a
major market, uh, where this could
potentially increase their revenue and
profits massively for Nvidia. And
there's, you know, there's the AI race,
the AI war, which we're not going to get
into that in this video. Obviously,
we're not giving in uh China Nvidia's
best chips. Uh that would not make
sense. The H200's are a bit older. Uh
but they're still obviously very good.
So, Bite Dance and Tencent have
reportedly received around 10,000 H200
chips each, and other major Chinese
technology companies may receive
similarly sized batches. And the US has
reportedly authorized purchases of up to
a 100,000 H200s per approved company.
And Nvidia is believed to have roughly
500,000 H200s reserved for potential um
customers in China. And the regulators
in China, which you guys know, they're
strict, right? They obviously they want
to they they want to keep everything in
house, but they're still requiring
casebycase approval and want most of the
approved chips deployed in Hong Kong
rather than mainland China. And the
question is, guys, why is this important
for Nvidia, right? First, it proves that
actual shipments are now starting to
begin, right? Which is big news. Nvidia
previously had US authorization, but
Beijing's restrictions prevented those
approvals. We covered this um you know a
couple weeks ago, prevented the
approvals from translating into actually
meaningful sales. Moving from
theoretical approval to physical
deliveries is a very important step,
which I don't know if that's fully being
priced in um to the stock yet. Maybe the
stock has obviously some more uh
hesitations about China, how much
revenue is actually going to be produced
by this, but we'll see. It could be a
lot. It could be um a lot, right? And
the the second key thing, Nvidia
excluded China data center compute
revenue from their previous guidance
because management couldn't predict uh
whether Beijing would actually permit
shipments. Um, and if delivery scale
beyond these first 20,000 ships, China
would become an incremental source of
revenue that wouldn't or wasn't included
um in Nvidia's
original outlook, which that would be a
big boost for the stock. I don't think
that's being priced in yet. Um, you
know, however, it is too early to assume
a major earnings boost this quarter. uh
because again we don't know when Nvidia
can recognize this revenue, how many
shipments they'll actually make or you
know the additional orders. I mean
there's still a lot going on but this is
a big development. Um and the third big
thing here guys is this demonstrates
that China still needs Nvidia. Forget
Huawei, forget their in-house chips.
Nvidia is the top dog. They still need
Nvidia. um even if it's the older chips.
Huawei and other Chinese companies are
improving especially for AI inference.
Uh but Chinese developers still rely
heavily on Nvidia hardware and its CUDA
software ecosystem right for actually
training the largest frontier models.
And China wants to support domestic
semiconductor companies, but it also
doesn't want Bite Dance, Tencent,
Alibaba, and you know, Deepseek, for
example, falling too behind um, you
know, American AI companies, which makes
sense. Think about it from the Chinese
perspective. They want to dominate the
world. They want to be the leaders in
everything militarily with AI,
technology, this, that, the third, you
know, um, they want to be the leaders.
So, it makes sense from their
perspective. Um, and of course, we want
to be the leaders here in the United
States, which is why we'll continue to
clash uh with China for quite some time.
So, that's a quick rundown on Nvidia
stocks coming down. I think it'll come
down a little more, not too much.
Investors are heavily awaiting the
earnings and maybe we'll get some more
info and insight on China in that
earnings call. Maybe we'll get some
questions, hopefully some answers. Um,
so let me show you Walmart quickly here,
guys. WT is obviously the ticker.
Everybody knows that this thing is down
9%.
Complete cliff drop here on Walmart.
Disgusting drop. We hit about 11516
um in the pre-market and now we're at
what 104. We hit 102. This thing is
about to go back into the double digits,
which is absolutely insane. So, Walmart
reported, let me uh let me show you guys
what's going on here. Walmart, well,
they did decent on earnings. Uh, but we
can see there are certain numbers that
aren't so good. Let me actually read you
the headlines quickly.
Um, they reported
EPS adjusted of 81 cents that beat the
74 estimate. sales 187.93 billion which
also beat the 186.79 billion. So double
beat out of Walmart but but other
numbers didn't look so good. US
comparable sales grew only 2.6% below
the roughly 3.8% expected uh from Wall
Street and that was Walmart's first
comparable sales miss in more than five
years. You heard that right? 5 years. Uh
customer traffic growth slowed to 1.5%
versus 3% from last year. Higher gas
prices are hurting lower income
customers, right, is what we're hearing.
Um causing them to pull back on
discretionary purchases. That makes
sense. Um Walmart expects fuel related
costs to run about $2 billion above its
original assumptions. Third quarter
guidance disappointed. Uh Walmart
expects adjusted EPS of 62 to 64 cents
below the roughly 67 cents analysts were
expecting. Even after, listen to this,
and even after uh Walmart raised their
fullear 20 um 2026 outlook, its
projected EPS of 280 to 287 still
remains below the estimate from Wall
Street of $2.90.
So yeah, they beat EPS in revenue, but
when you pop the hood up and you look
under the hood, Walmart is not doing
that well right now. And uh the market
was not expecting this. This is why
we're getting this shock reaction 10%
drop. And there were a couple positives.
I mean, revenue and adjusted EPS again
both beat. Um e-commerce grew 24%,
advertising grew 43%. That's good, but
not good enough to offset those other
weak points of the report um that we
mentioned, you know, and that's with
again them raising the fullear sales
forecast, you know what I mean? So, uh
not the best for Walmart. Now, am I
buying it here? Hey, no, not yet. But I
am watching it. You know, the the
valuation has always been the concern
for me with Walmart, especially when it
was at 130. That's why, you know, people
were commenting back then, oh, I'm
buying Walmart, I'm buying this. People
in retail, not everybody, but they
usually they obviously not everybody,
but sometimes, you know, a lot of these
people, they buy at the peaks, you know,
they're they're loading up when the
valuation's super high, you know, and
Walmart was screamingly overvalued here.
Um, and look, now it's down 30 bucks.
And I bet you those people that were
buying it here are super excited.
they're not buying it here. Right?
That's the the the crazy psychology when
it comes to stock market investing. You
know, you get excited when a stock's
going up. You know, everybody's talking
about it, but you don't love it when
it's down 25%, 30%. You know, you don't
like it there, which it doesn't make
sense. So, the valuation has come down a
lot. It might still be, you know, not
not the best. It's not dirt cheap, uh,
but obviously a lot better than what it
was. Uh, but for me, look, it's a
falling knife. Uh, but it's a lot better
than what it was the other the other
day, the other couple weeks. So, I
wouldn't blame you for buying Walmart
here. In fact, if you believe in the
company, it's and it's one of your core
holdings, which I don't own it, you
know, but if it is one of yours, listen,
it might be a great time to add. This is
when you want to buy your core holdings
when they're short-term weakness and you
have that long-term outlook. Um, and you
cut through the noise and you realize
the report wasn't terrible. They're just
going through some short-term comparable
sales store uh growth um concerns, which
I think we'll resolve. Um, it's Walmart
at the end of the day, guys. And the
charts look good. When in doubt, zoom
out. The three-year chart looks good.
The MAX chart looks good. So, honestly,
I mean, I'm not saying I'm not going to
buy it. I got to do my homework a bit
more, dive deeper into the valuation. Uh
but even as a swing trade, long-term
aside, it doesn't look that bad. We're
finally starting to come to a point
where um this is a good pullback
finally. I mean, Walmart went on a tear
for about a year and a half, guys. A
year and 3 months from March of 25, it
hit 80 bucks and it got all the way to
135 by May 26. We're talking 14 months
straight the stock went up. We've been
due for this this pullback and it's not
bad at all. This is not bad at all. 25%.
Again, this is where you'd want to buy
if it's one of your core holdings. And
if you want to even open a new position,
I'm not saying it's a bad stock just cuz
I don't own it. I just have more
homework to do. I'm not going to just
dive in on one massive red candle. Um
that would not be wise in my opinion.
Uh, you got to take it slow, do some
research, read deeper into the report,
which I still need to do, which is why
I'm not buying it yet. Uh, but man, if
it comes under 100, especially in this
window here, guys, I might have to. I
mean, holy smokes, at 85 to 90 bucks,
Walmart gets very interesting. Very
interesting. Here at 100, it's
interesting. Um, so it warrants me doing
more homework into it. It's getting
there. So, what do you guys think? I
mean, are you buying it? Is it one of
your core holdings? What do you think
about Nvidia, which I do own by the way?
Uh, let me know in the comments. Hit the
like button as well. Make sure to
subscribe. Hit that follow button. And
if you want to see what I'm doing in my
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there. And with that being said, cheers.
Have a great rest of your