Nvidia (NASDAQ:NVDA) stock will be in the spotlight when markets open on Monday as calls to slow the growth of artificial intelligence (AI) models continue. The scrutiny comes as the stock has slumped for five consecutive days, leaving it hovering at its lowest level since September 2.
Dario Amodei, Sam Altman, Elon Musk Urge AI Model Slowdown
Nvidia has become the poster child of the artificial intelligence industry because of its GPUs and its large investments. Its annual revenue is expected to jump to over $411 billion this year and $677 billion next year.
The company has also become the biggest investor in the AI industry. It has invested in top companies like Anthropic and OpenAI. In addition to this, it has invested in top companies like Marvell Technologies, Lumentum, CoreWeave, Nebius, Intel, SpaceX, Arm, IREN, and Nokia.
Therefore, its stock will be affected by the recent calls by top players in the AI industry to slow down AI model growth. In a long post on Saturday, Anthopic’s Dario Amodei said that the current phase will likely put people at risk. He said, "We must slow the pace at which we improve the capabilities of AI models. Progress will still seem fast, and we must make wise use of the time we gain."
His statement comes a few days after an Anthropic employee resigned, warning that unchecked growth may lead to human extinction by 2030. Other top players in the industry like Sam Altman and Elon Musk have also warned about the growth.
Consequently, Altman said that OpenAI will not go public this year, citing the safety issue. This is important for Nvidia is one of OpenAI’s biggest shareholders. It has invested over $30 billion and has committed to providing a financial backstop of its Ohio data center.
Nvidia Stock Has Slipped This Month, But Analysts Expect a Rebound
The new worries come at a time when Nvidia’s stock has come under pressure in the past few days. It has slipped from this month’s high of $234 to the current $218 and is sending mixed signals.
On the positive side, it has formed a cup-and-handle pattern and remained above the 50-day and 100-day Exponential Moving Averages (EMA). On the other hand, it has formed a rising wedge pattern, which is made up of two ascending and converging trendlines.
The stock has formed a bearish divergence pattern as the Percentage Price Oscillator (PPO) has continued falling. Therefore, there is a risk that the stock will drop to the psychological level of $200.
Top analysts remain optimistic about Nvidia shares, with the consensus target among analysts being $324, up by 48% from the current level. Raymond James’ analysts have a target of $515, up by 130% from the current level.
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