AMD’s rally from the April low is described as an impulsive advance, with five subwaves rising from 187 and a potential finishing wedge developing in wave 5 of III. The setup points to wave III nearing completion, which could indicate short-term exhaustion even as the broader trend remains upward. The accompanying weekly view is framed as consistent with a larger wave five advance, but it allows for a correction first.
If wave III завершes, the analysis flags scope for a higher-degree wave IV pullback. The main support zone cited sits between 360 and 436, while the bullish case is said to remain intact as long as price stays above the 270 invalidation level. A video recording of the analysis was streamed on 13 July, and the author is Gregor Horvat, who is based in Slovenia and has been in the Forex market since 2003.
Anticipating a Near-Term Correction in AMD
We see AMD’s powerful rally from the $187 low finally approaching exhaustion as the stock completes its wave III cycle. With the share price sitting near all-time highs this July, driven by strong market demand for the latest AI hardware, a temporary cooling-off period is expected. Derivative traders should prepare for this shift by adjusting their short-term strategies in the coming weeks.
Historically, high-flying semiconductor stocks experience pullbacks of 15% to 25% after explosive runs, which helps shake out weak hands before the next leg up. We anticipate this wave IV correction will pull AMD down into our key support zone between $360 and $436. This technical correction is standard, even as AMD’s data center segment continues to show massive strength with quarterly revenues recently scaling past $4 billion.
Trading Strategies Amid Wave IV and Positioning for Wave V
In the near term, we suggest derivative traders utilize bear put spreads or buy short-term put options to capitalize on this downward wave IV slide. Alternatively, selling out-of-the-money covered calls can help generate premium yield while the price consolidates. It is crucial to keep these bearish trades short-term, as the overarching weekly trend remains highly bullish.
As the stock descends into the $360 to $436 target area, we should prepare to pivot back to aggressive bullish strategies. This zone represents an excellent entry point to accumulate long-term call options or sell cash-secured puts to position for the next wave V surge. This bullish outlook remains completely intact as long as AMD holds above our key invalidation level at $270.
