Jim Cramer’s Bearish Calls: 10 Tech Stocks Heading for a Crash

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1. NVIDIA Corporation (NASDAQ:NVDA)

Number of Hedge Fund Holders In Q3 2024: 193

Date of Cramer’s Comments: 08-20-24

Performance Since Then: 10.19%

NVIDIA Corporation (NASDAQ:NVDA) is the world’s leading GPU designer. 2024’s close has seen investor and street sentiment about the stock concerned about competition that might eat away the market share for the firm’s AI GPUs. However, in multiple appearances, Cramer has dismissed these claims and stressed that he views AI chips from firms like Broadcom and Marvel will complement and not compete with NVIDIA Corporation (NASDAQ:NVDA). On a broader level, the firm’s hypothesis depends on stable shipments of its AI GPUs and sustained demand for AI products. Here’s what Cramer shared in August:

“I almost feel like you can guess it—it’s Nvidia. It’s the king, and the rest of the market is made up of its pawns, marching to Nvidia’s drum. Remember this morning when I was on the call and said, “Look, Nvidia is almost too important. There’s too much pressure on Nvidia—can it sustain it? I don’t want Nvidia to be Samson.

“Take a look at this daily chart of Nvidia, going back to February. By the way, Larry, who advised selling Nvidia just before it peaked in the spring, predicted the stock would rise again in late May. Larry and his video calls have closely tracked the stock’s short-term cycle in red, which has followed the share price surprisingly well.

“Unfortunately, the short-term cycle now projects that Nvidia should peak sometime next week, leading to a sell-off that may extend through mid to late October. Nvidia reports next week, and the long-term cycle indicates a bottom around the same time. Given that Larry sees Nvidia as the lynchpin of the market, it makes sense that the cycle forecast predicts a downturn for Nvidia, aligning with expectations for the S&P 500.

“Yes, Nvidia is that influential. The chart interpreted by Larry Williams suggests that we might experience some pain as August ends, which could continue through mid to late October. I hope he’s wrong this time, but it’s wise to consider his analysis seriously. For my money, there’s a good chance he could be right, especially if Nvidia’s outlook isn’t strong.”

NVDA was a tech stock Jim Cramer was worried about in August. While we acknowledge the potential of NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

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