Advanced Micro Devices Inc. AMD is having a slightly rough morning. The chipmaker's shares are trading down about 0.5% in Thursday's premarket session, and it's not because of anything AMD-specific. Instead, the dip is tracking a broader pullback in U.S. stock futures. Nasdaq futures are down about 0.5%, and S&P 500 futures have fallen 0.44%.
So, investors are feeling a bit defensive ahead of the opening bell, and AMD is caught in that downdraft. The question now is whether the stock can hold key support levels as trading volume picks up.
Technical Analysis
AMD is still in a long-term uptrend, but the near-term technical picture is a bit of a mixed bag.
The stock is sitting 4.8% below its 20-day simple moving average of $487.06 and 9.1% below its 50-day SMA of $509.94. That's a sign of continued short-term pressure. However, AMD is still 6% above its 100-day SMA of $437.20 and a whopping 41.4% above its 200-day SMA of $327.73. Those levels keep the longer-term bullish trend intact.
Here's the thing: the 20-day SMA is below the 50-day SMA, which is a bearish signal that could limit near-term rebounds. But the 50-day SMA remains above the 200-day SMA, which supports the longer-term bullish setup. So, it's a tug-of-war between short-term weakness and long-term strength.
Momentum, though, is improving. The MACD is above its signal line, and the histogram is positive. That suggests selling pressure may be easing, which could give buyers a bit of confidence.
Key resistance sits near $530, a round-number level that could attract selling during a rebound. On the downside, key support is around $463, which is close to where the stock is trading now.
AMD hit a 52-week high of $584.73 back in June, then fell to a swing low in July. Now, traders are watching to see if the stock can form a higher low, which would be a bullish sign.
The shares have gained 182.34% over the past 12 months. That's a fantastic run, but it also means the stock could be more vulnerable to sharper pullbacks when market sentiment weakens.
Analyst Outlook
AMD trades at a price-to-earnings ratio of 119, which is a premium valuation by any measure. The stock carries a Buy consensus rating with an average price forecast of $591.39.
Argus Research maintained a Buy rating on Aug. 6 and raised its price forecast to $625. Rosenblatt also maintained a Buy rating and raised its price forecast to $700 on the same day. JPMorgan, on the other hand, maintained a Neutral rating on Aug. 5 but raised its price forecast to $550.
MarketDash Edge Rankings
The MarketDash Edge scorecard highlights AMD's strong Momentum, Quality, and Growth scores, but its Value score is weak.
AMD has a Momentum score of 97.71, a Quality score of 93.98, and a Growth score of 94.91. Its Value score? Just 4.76.
That combination points to a high-growth stock with strong market momentum but an expensive valuation. It also makes the support near $463 all the more important if broader risk appetite continues to weaken.
Top ETF Exposure
The iShares Semiconductor ETF SOXX has an 8.10% weighting in AMD. The CoreValues America First Technology ETF USMD has a 7.74% weighting, and the ARK Autonomous Technology & Robotics ETF ARKQ has a 6.87% weighting.
AMD's sizable weight in these funds means ETF inflows and outflows can add to buying or selling pressure in the shares. So, keep an eye on those flows if you're watching AMD.
Price Action
Advanced Micro Devices shares were down 0.54% at $463.88 in Thursday's premarket session, according to market data.
