#AMD #Stock #Price #Levels #Watch #PostEarnings #Plunge
Key takeaways
- Shares of Advanced Micro Devices fell sharply in extended trading Tuesday after the chipmaker reported third-quarter earnings that fell short of expectations and issued a light revenue forecast.
- The stock rose to the upper trend line of the down channel, although lower trading volumes suggested that major market participants remained on the sidelines ahead of the company’s quarterly results.
- Investors should keep an eye on key support levels on the AMD chart around $162, $132, and $112.
- If the stock resumes its long-term uptrend, investors should keep an eye on the bullish price of the bars pattern around $275.
Shares of Advanced Micro Devices (AMD) fell sharply in extended trading Tuesday after the chipmaker reported third-quarter earnings that fell short of expectations and issued a light forecast for current-quarter revenue, despite record data center revenue.
During the company’s conference call, CEO Lisa Su told analysts that the chipmaker now expects data center revenue to exceed $5 billion in 2024, up from its July forecast of $4.5 billion. However, the stock’s after-hours decline suggests investors could have been looking for more amid insatiable demand for artificial intelligence (AI) infrastructure.
AMD shares have gained about 13% year to date through Tuesday’s close, underperforming the tech-heavy Nasdaq by about half over the same period. The stock fell 7.6% to $153.57 in after-hours trading Tuesday.
Below, we analyze the technical aspects on AMD’s weekly chart and point out important post-earnings price levels that other investors may be watching.
Descending channel
After the inverted hammer set an all-time high (ATH) for AMD in early March, the stock traded within a bearish writing channel.
Recently, the price has risen to the upper trend line of the pattern, although declining volumes indicate that major market participants have remained on the sidelines ahead of the company’s quarterly results.
Amid the stock’s expected post-earnings sell-off, let’s take a look at key support levels that could come into play and also expect a chart-based price target to watch if the stock resumes its long-term uptrend.
Key support levels to watch
The first important support level to watch is around $162. Although the stock is poised to open below this area on Wednesday, it will be worth watching if the bulls attempt to defend the trend line connecting the prominent peak in November 2021 and a set of similar trading levels within the down channel.
A decisive break below this level could send shares falling to the $132 area, a location where investors may look for buying opportunities around a series of prices located near the June swing highs and August swing lows.
More selling in the stock opens the door for a decline to around $112, about 33% below Tuesday’s closing price, as shares find a confluence of support from the 200-week moving average and a horizontal line extending into August 2021.
Long term upside price target
If AMD stock resumes its long-term uptrend, we can expect an upside price target using the bars pattern, a technique that uses historical trends on a chart to predict future price movements.
In this case, we take the stock’s uptrend from October 2023 to March of this year and reposition it from the early August low, which projects a price target of around $275.
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#AMD #Stock #Price #Levels #Watch #PostEarnings #Plunge
