Advanced Micro Devices Inc. (NASDAQ:AMD) stock rose more than 2% in Friday’s premarket trading as technology stocks gained alongside a broader improvement in risk appetite.

Nasdaq futures rose 0.55%, while S&P 500 futures gained 0.33%.

AMD remains in focus after recently crossing $1 trillion in market value, becoming the fourth U.S. chipmaker to reach the milestone after NVIDIA Corp. (NASDAQ:NVDA), Broadcom Inc. (NASDAQ:AVGO) and Micron Technology, Inc. (NASDAQ:MU).

AMD is building on its recent momentum after moving above its previous 52-week high. That breakout could attract additional buying from traders following the stock’s strong trend.

Breakout Has More Room To Run

OptionsPlay Chief Strategist Tony Zhang told CNBC on Wednesday that AMD could have more room to run after breaking out of a trading range that had held since May.

Zhang said AMD had traded between $450 and $550 before moving above $550 following reports of roughly 10% price increases across AI chips, graphics cards and chipsets.

He linked the increases to strong demand for AMD’s CPU and GPU server products.

Zhang said $750 could be a reasonable level by November. However, given AMD’s sharp rally, he said he prefers using options to limit downside risk.

He highlighted a November $600/$750 call spread that cost slightly more than $48 at the time, or about 7% of AMD’s share price. The strategy offers upside exposure through $750 while capping potential losses if AMD falls back into its previous trading range.

AMD Technical Analysis

AMD remains in a strong uptrend across several timeframes.

The stock is trading above its 20-day simple moving average of $520.41, 50-day SMA of $502.12, 100-day SMA of $497.60 and 200-day SMA of $362.71.

At its current price, AMD is about 23% above its 20-day SMA and 77% above its 200-day SMA. That signals strong momentum, but it also shows how far the stock has moved above its longer-term trend.

The moving-average structure remains bullish. The 20-day SMA is above the 50-day average, while the 50-day SMA is above the 200-day level.

AMD has also moved above its previous 52-week high of $630.80. Traders may now watch that former resistance level for support during a pullback.

However, the relative strength index stands at 72.64. An RSI above 70 generally indicates overbought conditions. That does not necessarily signal an immediate reversal, but it can increase the risk of volatility or profit-taking.

Key resistance sits near $643.31 as AMD trades around fresh highs. The $630.80 level represents the nearest major support.

Analyst Outlook

AMD trades at a price-to-earnings multiple of about 160.5, reflecting a premium valuation. The stock carries a Buy consensus rating with an average price forecast of $604.

Piper Sandler initiated coverage with an Overweight rating and a $600 price forecast on Sept. 10. Raymond James upgraded AMD to Strong Buy and raised its forecast to $641 on Aug. 25. BMO Capital initiated coverage with an Outperform rating and a $550 forecast on Aug. 21.

AMD Benzinga Edge Rankings

AMD’s Benzinga Edge scorecard reflects strong momentum, quality and growth, but a weak value profile.

The stock scores 99.27 for momentum, 95.56 for quality and 95.57 for growth. Its value score stands at just 3.29.

The combination highlights the trade-off around the stock. Strong growth expectations and momentum support the stock, while its elevated valuation raises the importance of continued execution.

ETF Exposure

AMD is a major holding in several semiconductor-focused exchange-traded funds.

The iShares Semiconductor ETF (NASDAQ:SOXX) has an 8.74% weighting in AMD. The First Trust Nasdaq Semiconductor ETF (NASDAQ:FTXL) has a 6.79% weighting, while the Pacer Data and Digital Revolution ETF (NYSE:TRFK) has a 6.52% weighting.

Because AMD carries significant weight in these funds, large ETF inflows or outflows can contribute to buying or selling pressure in the stock.

AMD Price Action

AMD Price Action: Advanced Micro Devices shares were up 2.10% at $642.49 during premarket trading on Friday. The stock is trading at a new 52-week high, according to Benzinga Pro data.

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