Nvidia (NVDA) shares are under intense scrutiny after experiencing a significant decline on Wednesday. The stock fell sharply amid rising concerns that new energy regulations in China could severely impact the sales of the AI chip giant.

A report from the Financial Times has revealed that Chinese authorities are recommending their companies utilize chips that adhere to stricter standards in new data centers and when upgrading existing facilities. This development poses a threat to Nvidia's less powerful H20 chip, which has been specifically designed to comply with U.S. export restrictions.

Since reaching an all-time high in January, Nvidia's shares have plummeted roughly 25%, reflecting heightened fears about reduced AI spending, slowing sales growth, and fluctuating trade policy under the Trump administration. On Wednesday, the stock fell by nearly 6%, closing at $113.76.

Technical Analysis: Key Price Levels

As Nvidia’s stock continues to trend downwards, it will be essential to monitor various price levels using technical analysis:

Support Levels

The $105 mark is critical for investors to watch. If the stock drops further, this area may serve as a potential buying opportunity, closely aligning with the March low and other price points dating back to May of the previous year.

Should selling pressure intensify, Nvidia's shares could retest support at $96, which is significant due to its alignment with last year’s twin peaks in March and the early August sell-off low. This area is also noteworthy as it corresponds to a target generated from the stock's recent downward momentum.

Resistance Levels

If there is a recovery rally, the $130 level will be essential to observe. This price point may present overhead resistance, marked by a trendline that connects multiple peaks and troughs dating back to August.

A firm close above $130 could catalyze a rally towards the $150 area, where investors who purchased shares at lower levels might consider cashing in on profits as this range has shown to be significant resistance historically just below the record high.

Investors and analysts alike are holding their breath as they observe how Nvidia navigates these precarious market conditions. With the growing reliance on AI technology, the company's future performance remains a crucial subject for market participants, particularly in light of shifting global regulatory environments.

Stay tuned for further updates as we continue to analyze key developments in Nvidia’s stock price movement!