$NVDA · Schwab Network · 2026-11-06

We have Nvidia, which is trying to recover from that sharp drop we saw yesterday. Which suffered very deep setbacks. We are now up 4% .

So, let's focus on Nvidia this morning . Joining us now for a closer look is Mali Kagan. Explain to us exactly what happened yesterday, Mali. I mean, the kind of pullbacks we were looking at and the recovery we're seeing today, because I think you and I have said many times on our show, "I wish I had a dollar for every time a market watcher said Nvidia was cheap at this point, with the lowest valuation we've seen in about a decade."

But tell us how we are monitoring this stock at the moment.

Yes, Sam. How cheap the price is is a big part of the discussion. Today, I saw multiple headlines about it being the cheapest in a decade or more, depending on how the numbers are calculated and what figures they rely on.

However, it cannot be denied that yesterday was a very brutal day for Nvidia. It witnessed a large sale. The session closed at 181.60. That was a drop of approximately 9.25 percent in that session.

This was its biggest daily drop since January 2025. And if we measure against its all-time high, which it reached on October 6, we are still down, even with this 4% rise today, by about 20%.

So, we are technically in a bear market, ending a year-long upward trend. We remain in this situation even as we move upwards. Yesterday’s session wiped out approximately $447 billion of Nvidia’s market value in a single session.

That is the second-largest daily loss in its history. Since its peak in October, it has lost nearly $1.4 trillion in market value. Its value is now approximately $4.5 trillion with today's upward movement.

The stock also broke its 200-day moving average. It is still low. The stock has fallen by about 11% this week not counting today's moves, so it is approaching 7 % after the rise we saw today.

We are on track to record our fifth consecutive weekly decline unless something changes here.

As you know, this is just a reflection of a future outlook for the artificial intelligence industry that continues to influence price here. Many of the comments I read yesterday about Nvidia indicated that the main pressure is coming from Washington and the results of the midterm elections .

The Democrats' victory in gaining control of Congress has raised many questions about the construction of data centers, and whether they will face stricter reviews of land use, energy, and environmental impacts.

Given the intense campaigning against data centers ahead of the vote, investors now fear that energy costs and local construction disputes will become more real obstacles to the AI business .

So, this is a potential and significant driver of what we have witnessed.

There were also many comments that I saw referring to terms such as "panic selling" and the like. There are some managers who see this as a buying opportunity, because, as I said at the beginning of our conversation, the stock is cheap, very cheap, and perhaps the cheapest it has been in a decade.

We speak with Michael Monahan and the Founder ETF team periodically on our network programs. They pointed out that short-term fluctuations do not reflect Nvidia's fundamentals, especially since hedge funds typically use high leverage while adhering to strict risk limits.

Therefore, when the stock starts to fall, we see traders quickly reducing their financial positions. This amplifies those dips during the day, and I think it was important that they pointed that out.

But he also warned that the same trading structure meant that sentiment could improve just as quickly, leading to a similarly rapid recovery.

Michael Monahan says Nvidia's revenues are still capable of growing by about 70% next year . He argued that even with concerns about building data centers, projects are likely to go ahead and support demand for AI chips.

He also mentioned that the Robin chip will provide a new wave of product momentum, and that SpaceX’s recent $40 billion funding agreement with Apollo shows that these major companies are still raising capital to secure artificial intelligence chips .

We also know that they have an upcoming earnings announcement event on November 17th. There are only 11 days left until this date. Therefore, he is a potentially major motivator here.

But he also thinks that some historical perspective might be important here, Sam. This reminds investors that a sharp decline does not necessarily guarantee a recovery. Looking back at Nvidia's history since its listing in 1999, we find only 12 periods of consecutive weekly declines of five weeks or more, which is where we are now headed.

In only five of those cases did the stock rise after 13 weeks. In eight of those cases, the stock was higher a year later. Therefore , historical data is conflicting if you are trying to rely on Nvidia's historical track record to predict whether we will rise.

The last similar decline ended in October 2022, after which the stock nearly quadrupled during the following year, driven by an AI boom first sparked by ChatGPT . So, it's an interesting perspective as we approach the earnings announcement, whether you want to believe those historical figures or not.

But, I mean, we are now 20% below our highest level since October. We wiped out nearly $450 billion in just one day. I mean, Sam, it's unreasonable to talk about numbers like that, where one move can wipe out so much.

And now, as I said, we are reclaiming some of that day. We are up 3.5 percent. We'll see where today takes us, but I think the word "brutal" is an appropriate description of what happened to Nvidia and many other tech names yesterday.

Yes, of course. As she says, it seems that the buy-the-dip crowd is now stepping in and snapping up Nvidia shares after yesterday's sell-off. But let's see what happens as we head towards the next catalyst, which is the earnings report in two weeks,

So, let's now trade this name with Dan Deming from KKM Financial. Have a happy Friday, Dan. Can you show us a trading model for this stock, because I think a lot of people are wondering exactly what to do with a stock like this given what we've seen this week, this pullback. Just explain to us how you will handle things.

Yes, Sam. Yes, this is definitely a major liquidation, but it will probably take two weeks to recover, and the market will be very volatile. It will be interesting to see how today's performance unfolds as we progress through the afternoon.

We saw an initial positive reaction after the heavy selling, but we are now seeing the market give up some of those gains. So, I think we'll see significant volatility during the day , as well as volatility in some strong stocks, with Nvidia being one of them.

So, today’s trading example is mainly about risk assessment. But the idea here is to allow this noise to subside somewhat . Having moved past these sell-offs and some other market dynamics, I think we will close the gap we saw in the last couple of days, and I expect to see higher prices once the market stabilizes.

So, today’s trading example is the December “Call Fly”, where we buy a call option at 195, sell two call options at 210, and buy a call option at 225 for December. This gives you a good profit zone in case the price goes up.

This transaction can be completed for approximately $2.10. Again, we identify the risks, but we provide a profit zone in case of an uptrend, where I believe we will fill that gap within the next month and a half.

One of the more interesting angles right now is the information that came in this morning , which suggests that Nvidia is behind TSMC’s potential move to look into DRAM as it seeks to enter the AI chip memory market, something that could put its competitors in a difficult position,