$AMD - Make or Break [Technical Analysis]
TECHNICALS
Currently, $AMD is trading around $76 per share down roughly 15% from the high of $89.20 it made on 4/27/21.
On a larger timeframe (1D pictured) there's potential for a head and shoulders breakdown. More importantly, the trend that $AMD had been following since the 2020 lows until March 2021 just had another run in with current price action. This most recent earnings report's momentum was not enough to reclaim that bullish trend and since then price has sharply rejected.
By using the fibonacci retracement tool and manually adding extension targets (original highs and lows are the red lines pictured) you see that the price above $70 has respected the same extension targets. Pairing the fibonacci with the Volume Profile Visible Range tool, there's a nice confluence in the -0.618, -0.5 and the pocket of low volume.
Below this level $AMD will go into what some call "Price Discovery" and will find out where exactly this bearish trend will end and when buyers will step in the driver's seat. Alternatively, this level that we've identified as important could act as the springboard buyers have been waiting for. Perhaps the gaps below the current price never get filled.
Fundamentals
While this idea was born out of technicals - $AMD trades at a P/E of 32.26 where it's number one competitor, $INTC, trades at a P/E of 12.54. We can debate which company is more forward thinking or a safer investment. This was just a comparison of a commonly used metric. The market as a whole in 2020 priced in A LOT of forward growth on companies one might think of as "aggressive." With returns just shy of 2,000% in the last 5 years, $AMD without a doubt falls into that category. A lot of the companies that had forward growth priced on are now seeing relatively steep declines in price, think $ZM, $TTD, $ROKU, etc.
Warwick, OptionsSwing Analyst
Currently, $AMD is trading around $76 per share down roughly 15% from the high of $89.20 it made on 4/27/21.
On a larger timeframe (1D pictured) there's potential for a head and shoulders breakdown. More importantly, the trend that $AMD had been following since the 2020 lows until March 2021 just had another run in with current price action. This most recent earnings report's momentum was not enough to reclaim that bullish trend and since then price has sharply rejected.
By using the fibonacci retracement tool and manually adding extension targets (original highs and lows are the red lines pictured) you see that the price above $70 has respected the same extension targets. Pairing the fibonacci with the Volume Profile Visible Range tool, there's a nice confluence in the -0.618, -0.5 and the pocket of low volume.
Below this level $AMD will go into what some call "Price Discovery" and will find out where exactly this bearish trend will end and when buyers will step in the driver's seat. Alternatively, this level that we've identified as important could act as the springboard buyers have been waiting for. Perhaps the gaps below the current price never get filled.
Fundamentals
While this idea was born out of technicals - $AMD trades at a P/E of 32.26 where it's number one competitor, $INTC, trades at a P/E of 12.54. We can debate which company is more forward thinking or a safer investment. This was just a comparison of a commonly used metric. The market as a whole in 2020 priced in A LOT of forward growth on companies one might think of as "aggressive." With returns just shy of 2,000% in the last 5 years, $AMD without a doubt falls into that category. A lot of the companies that had forward growth priced on are now seeing relatively steep declines in price, think $ZM, $TTD, $ROKU, etc.
Warwick, OptionsSwing Analyst
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