Could Nvidia stock correct in the near term? Some technical indicators say yes

When it comes to stock surges, even the most formidable giants are not immune to fluctuations, including Nvidia (NASDAQ:NVDA) stock. The semiconductor and artificial intelligence (AI) industry giant, has been attractively viewed due to its remarkable growth over the past year.

However, as market dynamics continue to evolve, analysts are now scrutinizing the possibility of a correction in NVDA stock in the near future. 

Nvidia's stock price currently trades over the $945 mark, with a year-to-date growth of more than 92%, reflecting the company's robust performance and investor confidence in its prospects.

Over the past 12 months, Nvidia has experienced a significant surge in its value, up over 253%, driven by the soaring demand for AI and the company's record financial results. The AI-driven demand has come about as the company’s GPUs are essential for AI processing.

The company's dominance in providing GPUs for data centers and machine learning applications has solidified its position as a key player in the AI market, contributing to the surge in its stock value.

However, Fairlead Strategies technical analysts said in a note this week that there could be a short-term downside move in play, although it has not been confirmed yet.

The firm revealed it is “watching heavyweight NVIDIA (NVDA), which has a new short-term counter-trend 'sell' signal from the DeMARK Indicators.” However, they currently “view the signal as low-conviction, barring its confirmation, given short-term overbought conditions are not yet in place.”

In the meantime, Nvidia stock continues to trade near the recent highs.