Fundamental Analysis: NVDA - AMD - AVGO
Semiconductors power the digital age. Their innovation drives economic growth and tech advancements. Strong semiconductor stocks often signal a healthy market and future tech potential.
Semiconductors, the tiny chips that power our digital world, are the lifeblood of modern technology. Their performance and efficiency directly impact the capabilities of devices ranging from smartphones to supercomputers. As technology continues to evolve, the demand for advanced semiconductors surges, driving innovation and economic growth.
A strong semiconductor industry is often a sign of a healthy economy. When semiconductor stocks perform well, it typically indicates optimism about future technological advancements and economic prosperity. However, it's crucial to remember that the semiconductor industry is cyclical and can be influenced by factors like global economic conditions, geopolitical tensions, and technological shifts.
Overbought Conditions and Fundamental Analysis
While technical indicators can signal overbought conditions, it's essential to consider the underlying fundamentals of a company. A company with strong fundamentals, such as a solid financial position, innovative products, and a competitive advantage, may continue to outperform even in overbought market conditions.
Conversely, a company with weak fundamentals may be vulnerable to a decline, even if the overall market is bullish. Therefore, a balanced approach that combines technical and fundamental analysis is crucial for making informed investment decisions.
Today’s edition delve into three semiconductor companies: Nvidia, Advance Micro Devices, and Broadcom. Given the sector's recent technical weakness, I have included Broadcom (AVGO) considering its market cap ($700+B versus $80+B for Microstrategy). This sector is so broad that in December there will be another edition including Intel (INTC), Micron Technology (MU), Texas Instruments (TXN) or Microstrategy (MSTR).
Broadcom (AVGO) has a significant market cap, during the current bull market, the 40 weekly average has supported price in pullbacks, currently the 10 and 20MAs are curling down (which is not good in terms of trend analysis), and $152 looks like the line of defense that is to be tested. Oscillators suggest the move is not complete. Is a buying opportunity on sight for a company with a market cap 3X larger than AMD?. People interested in semiconductors has to observe AVGO.
AMD was analyzed in the latest publication, currently the 5 weekly average rejected price action (not good), the series of lower highs is highlighted in the chart. On the potential bounce side, the volume is showing exhaustion, oscillators are in oversold zone and and price action is trying to stay above $135. Let’s analyze the fundamentals to understand the prospects behind AMD’s charts.
Of course, the analysis starts with NVDA, which is a security analyzed every week in the weekly compass and S/R levels editions.
Nvidia is a leading designer and manufacturer of graphics processing units (GPUs) utilized in a wide array of computing devices. These include personal computers, workstations, gaming consoles, accelerated computing servers, and supercomputers. Nvidia's technology enables advancements in fields ranging from gaming and visual content creation to artificial intelligence and scientific research.
The following is a comprehensive analysis for Nvidia, which is particularly relevant given the current market conditions. Technical experts anticipate a top, while mainstream news are saying already that SPX is heading to $7000 (You know what is my target before a significant pullback). In any context NVDA has special performance that you must know. Good things are below this paywall, check them out!
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