AMD and Intel Extend Rally Despite RSI Flashing Overbought for Weeks
Advanced Micro Devices (AMD) climbed roughly 18% in pre-market buying and selling on May 6 after a Q1 beat, whereas Intel (INTC) prolonged a multi-week run with a 13% achieve to a recent all-time high close to $108.
Both shares have carried 14-day RSI readings nicely above 70 for most of April, but every recent overbought print has been met with one other leg larger quite than the pullback the technical setup sometimes calls for.
Overbought Signals Lose Their Bite for AMD and INTC
AMD closed yesterday up 87% from early April, with each day RSI sitting at 72.54 even after a short mid-week dip. Intel’s RSI is extra excessive at 84.53, having stayed above 70 since mid-April.
Standard chart logic treats each readings as exhaustion zones. Yet AMD has rallied roughly 25% since first crossing into overbought territory, and Intel has added greater than 60% over the identical window.
The sample resembles late-stage development extensions the place momentum funds hold urgent winners throughout semiconductors and adjacent AI plays.
Pullbacks have stayed shallow, with consumers stepping in at moving averages as an alternative of ready for full RSI resets.
Earnings Keep Validating the Bid
AMD’s Q1 income of $10.25 billion topped estimates by roughly $360 million, with information heart gross sales up 57% year-over-year on demand for Instinct accelerators and EPYC processors. Q2 steering with a midpoint close to $11.2 billion sits above the $10.52 billion consensus.
Intel’s late-April report posted $13.6 billion in income in opposition to a $12.36 billion consensus, sending shares up almost 24% in a single session.
CEO Lip-Bu Tan famous a shifting CPU-to-GPU ratio inside information facilities, echoing the AI-driven tape that lifted Nvidia previous $5 trillion final month.
HSBC trimmed AMD to Hold on May 4 after the 77% April surge, signaling Wall Street is beginning to query the runway.
“In 13 months Lip Bu Tan Took intel from a attainable and unthinkable bailout candidate to one of many wealthiest firms within the chip business. There is a giant 3 of CPUs, AMD, Intel and ARM… and the brokers want way more CPUs than these three can produce,” Jim Cramer indicated.
Whether earnings momentum retains absorbing these warnings, or capital begins rotating into other AI names, will form the following a number of classes.
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