My New Price Target for AMD, Fed Day, Big Earnings Blast
Let's chart Advanced Micro Devices and check my newest target, look ahead to a low-expectations Fed Day and brace for earnings from the tech stars.
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Flowers
In all places, then, and in all seasons,
Flowers expand their light and soul-like wings,
Teaching us, by most persuasive reasons,
How akin they are to human things.
And with childlike, credulous affection
We behold their tender buds expand;
Emblems of our own great resurrection,
Emblems of the bright and better land.
- Henry Wadsworth Longfellow (1839)
Blossoming Sales?
Good morning, team. Happy Fed Day! This afternoon the Federal Open Market Committee will leave short-term interest rates where they currently are. Fed Chair Jerome Powell will hold his antepenultimate press conference as the leader of the world's most powerful central bank. I do not expect market-moving news to come from this corner this afternoon, but then again, I am not a high-speed, keyword reading algorithm designed to force momentum and price overshoot, so we shall see.
After the closing bell this afternoon, the fourth-quarter earnings reporting season will kick things up a notch into the next gear. A mix of mega-cap and high-tech names such as Meta Platforms (META) , Microsoft (MSFT) , Tesla (TSLA) , ServiceNow (NOW) , Lam Research (LRCX) and IBM (IBM) will all post their digits to the tape and more importantly. provide some current quarter guidance. That will or at least should move markets more than anything Jerome Powell says at this point in his career.
As we work our way through the zero-dark hours, as the last flicker of what was Tuesday ebbs into darkness and the infancy of what will become Wednesday dawns, there is news from Asia. News that matters greatly to not just "big tech" but in a narrowly focused way to the high-end designers of AI-capable GPUs.
Reuters reported early on Wednesday morning that Beijing had approved for three of that nation's largest tech companies, the purchase of Nvidia's (NVDA) H200 AI chips. This marks a shift in policy for mainland China as that nation has tried to fill its internal demand for chips such as these domestically. ByteDance (BDNCE), Alibaba (BABA) and Tencent (TCEHY) have been cleared to purchase more than 400,000 of these chips in aggregate.
Reuters has reported in recent weeks that Chinese tech firms beyond these three had placed orders for more than 2 million of these chips, which easily exceeds Nvidia's current supplies, even if approved. While this news is obviously a positive for Nvidia, that fact could very well, in theory, provide a boost in sales for the likes of Advanced Micro Devices (AMD) .
Lisa Su's company has designed the MI308 to compete with Nvidia's H200 in Chinese markets. I cannot find an exact number in the materials I have dug up that will provide a precise total of these chips that AMD holds in inventory. That said, investors may recall that AMD took an $800 million charge against these chips in Q2 2025. I doubt that they simply threw them away.
New Price Target for AMD
Viewers of the Claman Countdown (starring your friend and mine, Liz Claman) were treated to exclusive breaking news on Tuesday afternoon that viewers of either CNBC or Bloomberg TV were not. Facts are facts. The good stuff in Fox Biz at 3 p.m. Your author adjusted his target price for Advanced Micro Devices on the air and here, will illustrate that work for our readers.
Apparently, as one can see on the one-day chart of AMD, enough traders were watching, as the change in target price occurred just a few minutes after 3 p.m. ET. Either that or those keyword-reading algorithms that I often mention were scanning my words for news. Super.
Moving to the daily chart, readers will admittedly see some potential for a "double top" pattern of bearish reversal. That is a legitimate risk. What I'm pretty sure that I think I see is a cup with handle pattern bearing a $267 pivot. The stock has already taken back its 21-day exponential moving average and 50-day simple moving average, which has put swing traders and professional managers on the same page.
Readers will also see that the green line has recently crossed over the blue line as the blue line was pivoting from trending lower to trending higher. This is what we call a "mini" or swing traders' golden cross and is a medium-term bullish signal.
Let's move on to the indicators. Relative strength is running strong, but currently stands just below technically overbought levels. Below the chart, the daily moving average convergence divergence is postured about as bullishly as it ever gets. The histogram of the nine-day EMA is now well above the zero-bound. Additionally, the 12-day EMA is running above the 26-day EMA with both of those lines also standing well above zero. These are all short to medium bullish signals. AMD is set to report this coming Tuesday, February 3rd. Rah.
Price Target: $320 (up from $287)
Pivot: $267
Add: Down to the 50-day SMA (currently $221)
Panic: Loss of that 50-day SMA
Marketplace
Tuesday was a far better day for equities, at least technically than many pretty smart folks realized in real time. Sure, the Dow Jones Industrials gave up more than 400 points on the UnitedHeath Group (UNH) beat-down. (Thanks for reminding me to sell that garbage, I'm still long a few shares I bought for a trade.) That's okay. Nobody has followed the Dow Industrials since 1992 anyway.
Moving on to domestic equity indices that actually are tracked by passive investors and do matter, the S&P 500 added 0.41% on Tuesday as the Nasdaq Composite tacked on a nifty 0.91%. What did the small caps do? Underperform, that's what, but not all small caps danced to the same tune. The Russell 2000 gained 0.26% for the session, but the S&P 600 lost 0.37%. Hmm, how was breadth, Sarge? Funny you asked. Check this out...
Breadth
Seven of the 11 S&P sector SPDR exchange-traded funds closed out the regular session on Tuesday in the green led by technology (XLK) one day ahead of the Fed and one day ahead of that bevy of earnings reports mentioned above. Oddly enough, the utilities (XLU) nearly kept up with Tech making for a couple of strange bedfellows. Health Care (XLV) obviously rode the Tuesday train in the caboose.
Here's where it gets fun for the numbers nerds. Winners beat losers at the NYSE by a rough five-to-four and at the Nasdaq by better than five to four. Advancing volume took a 58.4% share of composite NYSE-listed trade and a really impressive 68.5% share of composite Nasdaq-listed activity. More importantly, all of this broad positivity came on improved trading volumes.
On a day-over-day basis, aggregate trade across NYSE-domiciled and Nasdaq-domiciled names increased by 7.3% and 6.9% respectively. Volumes also popped across the membership of the S&P 500. Does this make for a "Day One" reversal of trend? Well, Tuesday was the fifth consecutive day of the current rally. That's not really a reversal, though the first four days came on contracting trading volumes. Take a look...
What we have here, is a re-confirmation of the bullish trend. Look at Relative Strength riding above neutrality. Look at the daily MACD. The nine-day EMA appears ready to kiss the zero-bound and the 12-day EMA appears ready to cross above the 26-day EMA with both of those lines well into positive territory. Technically, Tuesday was a very bullish day. Do the powers that be already know what the Fed will do or how this afternoon's earnings will turn out? Or do those events ruin what could have been a party? Let you kids know in about twenty-four hours. Until then, party on, dudes.
Disturbing
The U.S. economy, at least statistically, appears to be starting to really take off. That's why the Conference Board's survey on Consumer Confidence for January, which has a much better reputation for accuracy than the University of Michigan's survey for Consumer Sentiment, really cut to the bone. The headline number dropped in January to 84.5 from an upwardly revised 94.2 for December. This was the weakest headline print for the series since May of 2014.
In Tuesday's column, I discussed how the economy was starting to cook across a number of metrics, ex-labor, and that I expected that trend to continue as business spending will likely continue to accelerate and as both lower taxes and regulation push activity along. Well, those labor market concerns are starting to hit home as AI threatens to take more and more jobs. Just look at yesterday's news of job cuts at Nike (NKE) . It doesn't matter what business you're in, you better learn to coexist with and compete against not really generative AI, but more importantly agentic AI. That's the threat. Don't hide from it.
Within the survey, a measure of expectations for the next six months fell to its lowest level since April while feelings about the present situation fell to a five-year low. The percentage of respondents saying that jobs were difficult to get fell to its lowest levels since February 2021. The percentage of American workers who expect to get a raise at their jobs this year is dropping as well. That will eventually show up in reduced household expenditures on big-ticket items and on purely discretionary goods and services.
Economics
(All Times Eastern)
07:00 - MBA 30 Year Mortgage Rate (Weekly): Last 6.16%.
07:00 - MBA Mortgage Applications (Weekly): Last 14.1% w/w.
10:30 - Oil Inventories (Weekly): Last +3.602M.
10:30 - Gasoline Stocks (Weekly): Last +5.977M.
The Fed
(All Times Eastern)
2:00 - FOMC Policy Decision.
2:30 - FOMC Press Conference.
Today's Earnings Highlights
(Consensus EPS Expectations)
Before the Open: (ASML) (7.55), (T) (.46), (DHR) (2.19), (GEV) (3.12), (GD) (4.12), SBUX (.59)
After the Close: (IBM) (4.29), (LRCX) (1.17), (META) (8.19), (MSFT) (3.92), (NOW) (.89), (TSLA) (.45), (URI) (11.80)
At the time of publication, Guilfoyle was long NVDA, AMD, UNH equity.
