AMDenied
Updated
It appears to be coiling up for a nice breakout. AMD's newest processor release is supposed to be on June 10th.
Yet despite these tailwinds, the stock has broken its uptrend. This implies AMD's recent rally is based on expectations of a slew of processor releases for the 2nd quarter. With COVID delays and supply chain complications this doesn't seem particularly likely. Furthermore, much of AMD's revenue growth will take place in the corporate/datacenter markets from here on out. The enthusiast market is already saturated while mid- to low-end customers are likely to focus on spending thriftily. Hence, instead of a breakout, AMD's stock seems likely to take a nosedive on any news that processor releases will be delayed and/or the processors being released are OEM/low-end products.
Expect a much smaller hit than the nosedive pictured here if the release is not delayed and any OEM processor releases are paired with new OEM partners.
Yet despite these tailwinds, the stock has broken its uptrend. This implies AMD's recent rally is based on expectations of a slew of processor releases for the 2nd quarter. With COVID delays and supply chain complications this doesn't seem particularly likely. Furthermore, much of AMD's revenue growth will take place in the corporate/datacenter markets from here on out. The enthusiast market is already saturated while mid- to low-end customers are likely to focus on spending thriftily. Hence, instead of a breakout, AMD's stock seems likely to take a nosedive on any news that processor releases will be delayed and/or the processors being released are OEM/low-end products.
Expect a much smaller hit than the nosedive pictured here if the release is not delayed and any OEM processor releases are paired with new OEM partners.
Comment
Edit: The source I used which said June 10th seems to have edited their information. It no longer contains this specific date.Comment
More information about expectations of a June OEM release:wccftech.com/amd-renoir-flagship-ryzen-4900h-hard-launching-in-2h-2020/
B550, June 2020:
amd.com/en/press-releases/2020-04-21-amd-expands-3rd-gen-amd-ryzen-desktop-processor-family-unleashing
Info about server/datacenter growth:
247wallst.com/technology-3/2020/06/03/cfo-outlines-what-will-drive-amd-stock-to-higher-performance/
Comment
zdnet.com/article/aws-brings-ec2-c5a-instances-powered-by-amd-into-general-availability/We got an announcement about AMD products in the corporate/datacenter, which should juice the stock price. Remember that this is an incremental rollout of a product already in service. AMD's valuation likely already accounts for this. Expect the hype to be short-lived.
Comment
Though today's price action looks promising given the broader market's rise, this is not the correct entry point. I will be continuing to monitor AMD over the next 3 trading days to look for the expected price increase.This price action should not occur later than June 9th. Too much time between the drop on may 26-27 and the subsequent recovery will cause AMDenied's general thesis to be called into question. Thus it's time to wait and see.
Comment
Today is the last day for AMD to complete its fake breakout. If it ends the day below the market or above the selected breakout lines, we can conclusively determine this attempt to predict AMD's price trends is flawed. If we get a relatively fitting trend I'll be opening 1 month puts near EOD.Comment
The "breakout" has halted nearly exactly where the run was predicted to stop. It's not exactly on target (the drop was supposed to be today, not tomorrow) but the price target has been met and momentum looks increasingly weak. Hence, I have opened $40 AMD puts for July 2nd. I will sell when the next price target is met.Due to the low price of these puts it's extremely likely any attempt to sell them will result in little to no return. This is a risky put - but given the price action, I feel it's justified.
Comment
If I had to guess, my initial predictions were off by 2 days. It's therefore likely the price won't drop below 50 until Friday, June 12th.Comment
My predictions were wrong, again. If we don't see movement below 50 today it's likely time to sell those puts rather than hold and pray.Comment
Alright - prediction soundly defeated. Even if we go down from here, it doesn't matter. It's been wrong since June 10th! Need to define more solid targets in the future.
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