The charts are pointing to another rally for AMD, according to one technician.
has not only more than doubled its share price this year, TradingAnalysis.com founder Todd Gordon said it has also finally broken out of a nearly two-decade resistance.
The technician says the chip stock has moved out of a resistance that sat at around the $38 level since 2000, and that the recent rally has finally taken AMD above that mark."This has been one of the best-performing stocks in my portfolio," he said Thursday on CNBC's"I think we have more upside to go as this name continues to catch market share from its largest competitors.
To take advantage of AMD's breakout, Gordon wants to buy the February monthly 40-strike calls and sell the February monthly 45-strike calls for a debit of $1.85. This means that if AMD closes below $40 on Feb. 21 expiration, Gordon could risk the $185 he paid for the trade. But if AMD closes above $45 on Feb. 21, then Gordon would make $315 on the trade.
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