Nvidia plunges to pre-AI boom prices while Apple drops $30B on chips — buy the d
Thesis
Bloomberg reports Nvidia has shed roughly $1 trillion in value, bringing its valuation down to levels not seen since before the AI boom began. Despite this sell-off, CNBC notes that traders are actively betting on a snap-back rally for the chipmaker. Connecting this to the news that Apple just locked in a $30 billion deal with Broadcom, it's clear that the fundamental demand for high-end silicon is far from broken. If massive chip deals are still happening, the broader AI and tech selloff looks overdone, making Nvidia's new 'cheap' valuation a prime target for a bounce.
Strategy approach
Build a mean-reversion strategy that enters long NVDA on D1 when the stock is oversold (e.g., 14-day RSI < 40) and the broader semiconductor space shows relative strength, indicated by AVGO closing green. Exit after 10 trading days or if NVDA drops 5% from entry.