As Nvidia and tech shares were hit hard by the emergence of a possibly cheaper and more efficient artificial intelligence model out of China, technical analysts were scanning the price charts to find both key levels where the stocks may find support as well as where a breakdown would signal more selling. For AI darling Nvidia , the dominant maker of processors to power AI, the downside floor could be reset to roughly between $115 and $120 from the $130 level seen over the past three months, according to Wolfe Research macro strategist Rob Ginsberg. For a broader reading on the technology sector, Ginsberg is watching the price of the Technology Select Sector SPDR Fund ( XLK ), where he expects buying to kick in between the stock's recent low of $224 and about $230. NVDA 1D mountain Nvidia shares on Monday. "Something clearly spooked the Tech sector on Friday, as XLK's outside reversal after trying to breakout will likely see some healthy follow through today on DeepSeek concerns," Ginsberg wrote in a Monday note to Wolfe Research clients. "We will see if this development has lasting implications for the sector, but for now it certainly looks as though any positive momentum that was being built is reversing." Ginsberg's outlook came as tech stocks were battered Monday in a sell-off tied to China-based AI laboratory DeepSeek. Shares of Nvidia sank nearly 13%, Broadcom slumped 14%, and Micron Technology and Arm Holdings pulled back 9% each. XLK 1D mountain Technology stocks led the sell-off on Monday. DeepSeek's open-source large language model recently notched benchmarks that clocked in ahead of OpenAI's ChatGPT, which DeepSeek said cost less than $6 million. By comparison, Western companies, including Meta Platforms , Microsoft and Alphabet's Google have spent billions buying chips and building data centers to construct similar models. The sell-off also held deeper implications for the AI race between China and the U.S. and raised worries that the technology gap is closing between the world's two largest economies.
