Advanced Micro Devices Inc. (NASDAQ:AMD) stock rose more than 2% in Monday’s premarket session as improving risk appetite lifted large-cap technology stocks. Nasdaq futures gained 1.28%, while S&P 500 futures advanced 0.80%. Other semiconductor stocks also traded higher before the opening bell.

AMD’s early gains appeared to track the broader market rally rather than any company-specific news. Investors continued to favor high-growth technology stocks as U.S. equity futures moved higher.

The stock has posted strong gains over the past year. With its next earnings report approaching, traders are watching whether AMD can maintain its recent momentum.

Technical Analysis

AMD is trading near its 20-day simple moving average (SMA) of $533.06, making that level an important short-term support area. The stock remains 4.9% above its 50-day SMA of $508.48, 38% above its 100-day SMA of $386.58 and nearly 75% above its 200-day SMA of $305.68. The longer-term trend remains firmly positive.

The relative strength index (RSI) stands at 49.66, indicating neutral momentum. That suggests the stock has cooled after its recent rally and is now consolidating.

The bullish trend remains intact because the 20-day SMA is above the 50-day SMA, while the 50-day SMA remains above the 200-day SMA. AMD reached a 52-week high in June after rebounding from a May swing low and has since entered a consolidation phase.

• Key resistance: $546.50
• Key support: $498.00

Earnings And Analyst Outlook

AMD is scheduled to report second-quarter results on Aug. 4.

• EPS estimate: $1.55, up from 48 cents a year earlier.
• Revenue estimate: $11.28 billion, up from $7.68 billion a year earlier.
• Valuation: Shares trade at about 174 times earnings.

The stock carries a consensus Buy rating with an average analyst price forecast of $574.36. Recent analyst actions include:

• UBS: Reiterated Buy, raised price forecast to $730 on July 24.
• Jefferies: Reiterated Buy, raised price forecast to $640 on July 24.
• Roth Capital: Reiterated Buy, raised price forecast to $650 on July 24.

Benzinga Edge Rankings

AMD scores highly on Momentum, Growth and Quality, while its Value score remains weak because of its premium valuation.

The combination suggests investors continue to reward the company’s growth prospects. However, the elevated valuation could lead to larger swings if earnings or guidance disappoint.

Top ETF Exposure

• iShares Semiconductor ETF (NASDAQ:SOXX): 8.47%
• ARK Next Generation Internet ETF (NYSE:ARKW): 8.21%
• Pacer Data and Digital Revolution ETF (NYSE:TRFK): 8.22%

AMD’s large weightings in these funds mean ETF inflows and outflows can influence demand for the stock.

Price Action

AMD Stock Price Activity: Advanced Micro Devices shares were up 2.41% at $534.53 during premarket trading on Monday, according to Benzinga Pro data.

Image via Shutterstock