AMD strictly moderated (AMD)

[blair1q]

Let's review.

On 5/20/2007, a bullish call was made on AMD, bolstered by the claim that technicals were better than fundamentals, in the short term.

According to this chart, (5/18 is the closest the software will allow me to get to 5/20), 5/20 was a day or two past the peak before a month-long, nearly monotonic slide of about 12%.

http://finance.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1196461487000&chddm=52256&q=NYSE:AMD

That said, it's a good thing that was only a short-term call, as since that peak, the stock has lost over 35% of its value.

I think there was a flaw in the reasoning used to make the bullish call: "Technical analysis" is, always has been, and always will be, a great way to make a totally random decision with unflappable resolve. The price movement of a stock is random with respect to its internal stochastics. It is non-random when the state of the company, its performance, and the sentiment and knowledge of the human beings trading in it are taken into consideration. Watching only the price and ignoring the very visible forces behind its motions will give you no information that you can use to trade. You will be throwing dice, and thinking that every right decision was a certainty while every wrong decision was anomalous or "normal variance".

AMD's fundamentals in May were horrible. It was being held up by pure hype and hope, and then hanging only from a thread. They have, if anything, worsened, because of the failure of the Barcelona launch that was being hyped then. Until significant changes are made in AMD's structure, product plans, execution, and finances, this stock will continue to fall.