Nvidia Stock Surges 20% on AI Chip Hype, Golden Cross Signal

Nvidia has regained its position at the top of Wall Street, closing last week with three consecutive all-time highs and a five-day winning streak. Investors are now anticipating the next surge in the company's stock, which has seen a sharp rebound after months of stagnation and investor doubt since the beginning of 2025.

Earlier this year, traders had pulled back due to fears over U.S. restrictions on chip exports to China, which affected major semiconductor companies, including Nvidia. The stock remained in a flat range with no significant momentum for most of the year. However, the sentiment has shifted, with analysts noting a renewed interest in AI semiconductors, of which Nvidia is a leading player.

Analysts attribute the recent surge in Nvidia's stock to several factors. One key driver is the technical chart signal known as a golden cross, where the 50-day moving average moves above the 200-day moving average. This pattern often indicates a new long-term uptrend. Additionally, the upcoming rollout of Nvidia's new Blackwell chips, expected to gain full speed in July and continue through August and September, is seen as a significant catalyst for higher revenue and stronger guidance.

Analysts believe that the excitement around the Blackwell chips is already priced in to some extent, but not fully. They expect Nvidia to benefit from scaling up the chip and expanding margins in the process. This scaling and margin expansion are anticipated to drive the company's growth over the next few quarters. Furthermore, Nvidia's current valuation is considered solid, even with the stock at new highs, making it one of the most attractive large-cap tech companies on a price-to-growth basis.

One potential concern is whether Nvidia's biggest customers, the hyperscalers, might decide to build their own custom chips. However, analysts dismiss this possibility, citing the high cost of making chips from scratch. Most of these companies are expected to continue relying on Nvidia for their chip needs. Additionally, the broader AI buildout is still in its early stages, providing Nvidia with more room to grow. The intense competition for AI dominance, as evidenced by Big Tech companies' hiring tactics, further underscores Nvidia's central role in the AI infrastructure race.