Don't Ignore This Chart!

Rotating Back Into the Leading Quadrant While Breaking Above Resistance in Price and Relative Strength... What More Do You Want?


AMD weekly chart with relative strength and RRG - Lines

When I ran the RRG for the most active movers in the S&P 500 (at yesterday's close), I noted a strong rotation for AMD.

This stock entered the leading quadrant in the week of 18 March and moved inside that quadrant until the week of June 24, picking up 30% (vs S&P 4.2%). From 24 June onwards, AMD rotated through the weakening quadrant, curling back up just before its tail would hit lagging.

Over the last three weeks, relative momentum has picked up for AMD and is now close to re-entering the leading quadrant, very likely starting a new up-leg in its relative uptrend.

Weekly RRG of Most active stocks in S&P 500 (11/14)

Bringing that rotation back to a regular time/price based chart gives the picture printed at the top of this article.

The recent break above horizontal resistance in price, as well as in relative strength, supports a further rise in AMD.

But... be careful. This image does not tell the whole story. AMD is one of the tech stocks that is NOT pushing to new all-time highs. So, for us to get the complete picture, we should also inspect the longer-term chart.

This chart reveals that there are two major former peaks that are likely to come into play as resistance - one around $ 42.70 (2006) and the other one at $ 48.50 (2000). Nevertheless, that first level is still almost 14% from current levels while the downside is well-protected (stops?) near $34.50.


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Julius de Kempenaer

Senior Technical Analyst,

Creator, Relative Rotation Graphs

Founder, RRG Research

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Julius de Kempenaer
About the author: is the creator of Relative Rotation Graphs™. This unique method to visualize relative strength within a universe of securities was first launched on Bloomberg professional services terminals in January of 2011 and was released on in July of 2014. After graduating from the Dutch Royal Military Academy, Julius served in the Dutch Air Force in multiple officer ranks. He retired from the military as a captain in 1990 to enter the financial industry as a portfolio manager for Equity & Law (now part of AXA Investment Managers). Learn More
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