AMD Wants to Take AI Share Away From Nvidia; Buying on Government Open Continues; Fed Divided

Author: The Arora Report | November 12, 2025 11:59am

AI Share

Please click here for an enlarged chart of Advanced Micro Devices Inc (NASDAQ:AMD).

Note the following:

• This article is about the big picture, not an individual stock.  The chart of AMD stock is being used to illustrate the point.
• The chart shows AMD stock trading in a wide range yesterday as the company conducted its investor day.
• The chart shows AMD moving up this morning.
• The price action in AMD is a learning moment for investors.  It is not how good the investor day is.  It is how what is said compares to expectations. The reason for high volatility was that investor expectations were very high that AMD would give more bullish numbers than what were already discounted in the stock.  It turned out that, with the exception of total addressable market, the numbers AMD provided were already discounted in the stock.
• RSI on the chart shows that if upward momentum takes hold, the stock has room to run.
• Here are the key points from AMD's investor day:
  • AMD is planning to take AI market share away from NVIDIA Corp (NASDAQ:NVDA). In our analysis, AMD has a shot at capturing 10+% market share in AI.
  • AMD is projecting 35% compounded annual growth rate over the next three to five years.
  • AMD is targeting $20 in earnings per share by 2030.
  • AMD has increased its total addressable market to over $1T.
• In our analysis, in the longer term, one of the key factors will be if OpenAI fully ramps to six gigawatt potential with AMD.  The other key factor will be how many gigawatt-scale customers AMD attracts.
• Yesterday, NVDA stock was sold.  This morning NVDA stock is seeing buying after a key supplier Foxconn said that it expects strong AI demand through next year and reported 17% earnings increase year-over-year.
• The Fed is divided over a possible interest rate cut in December.  Here are the main questions for the Fed as it balances inflation and the risks to the labor market:
  • Are price increases from tariffs a one time event or will they sustain?
  • Is weak hiring an indication of reduced supply or slowed demand?
  • Are rates restrictive?
• After the government opens, economic data will start to trickle in and may become a big driver of the markets.
• This morning, there is buying in the stock market as euphoria about the government reopening continues.
• Prudent investors need to be aware of a new development that may become a trend.  During the pandemic, wages of hourly employees rapidly rose.  Lately, wages have been stagnant, but now, wages may start coming down.  This is not a good development for the low end consumers and in turn, for the companies that sell to low end consumers.  Walgreens has announced it will decrease wages for hourly workers and no longer provide paid holidays and vacations.

India

India’s Consumer Price Index (CPI) came at 0.25% year-over-year vs. 0.48% consensus.

In our analysis, this data increases the probability of a rate cut by the Reserve Bank of India.   If on top of this India strikes a good trade deal with the U.S., stocks in India could rip.  There will be a new signal on the India ETF WisdomTree India Earnings Fund (NYSE:EPI) by us on our portfolios.  When appropriate, there may also be new signals on India ETFs, iShares MSCI India Small-Cap ETF (BATS:SMIN), and VanEck India Growth Leaders ETF (NYSE:GLIN). There may also be a signal on India focused fund Fairfax India Holdings Corp (OTC:FFXDF).

Magnificent Seven Money Flows

Most portfolios are now heavily concentrated in the Mag 7 stocks.  For this reason, it is important to pay attention to early money flows in the Mag 7 stocks on a daily basis.

In the early trade, money flows are positive in Nvidia (NVDA), Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc Class C (NASDAQ:GOOG), Meta Platforms Inc (NASDAQ:META), Microsoft Corp (NASDAQ:MSFT), and Tesla Inc (NASDAQ:TSLA).

In the early trade, money flows are neutral in Apple Inc (NASDAQ:AAPL).

In the early trade, money flows are positive in SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust Series 1 (NASDAQ:QQQ).

Momo Crowd And Smart Money In Stocks

Investors can gain an edge by knowing money flows in SPY and QQQ.  Investors can get a bigger edge by knowing when smart money is buying stocks, gold, and oil.  The most popular ETF for gold is SPDR Gold Trust (GLD).  The most popular ETF for silver is iShares Silver Trust (SLV).  The most popular ETF for oil is United States Oil ETF (NYSE:USO).

Oil

The discount on Russian oil has widened to about $20 per barrel due to India reducing buying of Russian oil.  The $20 discount is the highest this year.

Bitcoin

Bitcoin (CRYPTO: BTC) is range bound.

What To Do Now

Consider continuing to hold good, very long term, existing positions. Based on individual risk preference, consider a protection band consisting of cash or Treasury bills or short-term tactical trades as well as short to medium term hedges and short term hedges. This is a good way to protect yourself and participate in the upside at the same time.

You can determine your protection bands by adding cash to hedges.  The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive.  If you do not hedge, the total cash level should be more than stated above but significantly less than cash plus hedges.

A protection band of 0% would be very bullish and would indicate full investment with 0% in cash.  A protection band of 100% would be very bearish and would indicate a need for aggressive protection with cash and hedges or aggressive short selling.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

Traditional 60/40 Portfolio

Probability based risk reward adjusted for inflation does not favor long duration strategic bond allocation at this time.

Those who want to stick to traditional 60% allocation to stocks and 40% to bonds may consider focusing on only high quality bonds and bonds of five year duration or less.  Those willing to bring sophistication to their investing may consider using bond ETFs as tactical positions and not strategic positions at this time.

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The Arora Report is known for its accurate calls. The Arora Report correctly called the big artificial intelligence rally before anyone else, the new bull market of 2023, the bear market of 2022, new stock market highs right after the virus low in 2020, the virus drop in 2020, the DJIA rally to 30,000 when it was trading at 16,000, the start of a mega bull market in 2009, and the financial crash of 2008. Please click here to sign up for a free forever Generate Wealth Newsletter.

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Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.

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