It has been said there’s always a bull market somewhere. I personally like to say there’s always a line somewhere as it relates to stocks. And for Advanced Micro Devices (NASDAQ:AMD) those proposed ideas are supporting the position that it’s time to go long AMD stock today.
Let me explain.
CNBC’s James Cramer has been known to say “there’s always a bull market somewhere” for investors to buy into. But making money in those situations can be another matter entirely. This market takes no prisoners for those that are too early or late to the game. But right now, Advanced Micro Devices stock is playing the game right for bulls to take the plunge today.
Off the price chart, Advanced Micro’s most recent earnings report in late January wasn’t without a couple of chinks in the near-term armor. Still, AMD stock delivered in spades with its longer-term, full-year outlook and one which continues to defy the skeptics under the stewardship CEO Lisa Su.
Conditions are also setting up on the price chart. Again, it’s not a situation without incident. Nevertheless, one of the more important technical lines in a landscape always filled with a plethora of various price lines known to incite and disturb bulls and bears alike is signaling that it’s time to go long AMD stock today.
AMD Stock Daily Chart
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There’s always a line somewhere. From trend lines to channel lines, Fibonacci lines and a host of other visual supports, cluttered evidence for bulls and bears can exist simultaneously on a technician’s price charts. And as the well-annotated daily chart of AMD stock unequivocally shows, shares of Advanced Micro Devices are no exception.
Despite this messy uncertainty I don’t mind making the technical case for AMD today. This past Friday, AMD shares successfully tested the well-watched, long-term 200-day simple moving average for support. That’s bullish, but it gets better.
Friday’s challenge is the second such test of the 200SMA since the AMD stock price bottomed in late December as part of corrective double-bottom. The prior test came immediately in front of AMD’s bullish earnings reaction, which resulted in a very large price gap defining the current trend. That’s even more bullish, right?
But that’s not all, either.
Advanced Micro Device’s corrective challenge of long-term support also put Friday’s intraday price action within January’s earnings gap and slightly beneath the post-earnings low. Sure, some technical traders might note other technical lines have been broken in the process. And obviously that can’t be denied, but nor should it necessarily be feared. This is trading mind you.
At the end of the day, if you’re like me and accept the fact that the only certainty on Wall Street is the opening and closing bell of the NYSE, for investors trying to find a bull market somewhere, AMD stock looks like a compelling candidate to go long today.
Disclosure: Investment accounts under Christopher Tyler’s management currently own positions in AMD stock and / or AMD derivatives, but no other securities mentioned in this article. The information offered is based upon Christopher Tyler’s observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional options-based strategies, related musings or to ask a question, you can find and follow Chris on Twitter @Options_CAT and StockTwits.
