LRCX Breaks July Lows: Is the Semiconductor Rally Dead?
YouTube chart analysts are waving red flags on semis while X is still vibing on AI capex euphoria. One of them is about to look very wrong.
Ticker Ratings
Sometimes the market flashes a warning sign and everyone just... keeps scrolling. This week, $LRCX (Lam Research) broke below its July lows after earnings, and TheChartGuys on YouTube called it flat out: this confirms a monthly downtrend in a key semiconductor name, and it raises serious red flags for $AMD and $MU if they follow suit. Spoiler: they haven't bounced convincingly yet.
The setup is ugly. The NASDAQ, which notched a solid +1.05% session on October 21st, is already forming a daily lower high inside a rising wedge pattern according to chart analysis from TheChartGuys. Wedges breaking down are basically the technical equivalent of a Jenga tower when someone pulls the wrong block. Semiconductors and memory names are sitting near lows in tightening ranges, which usually resolves one way: messily. Meanwhile, $SNDK is also on the watch list as a potential domino.
Here's where it gets interesting. On X, the vibe is almost the opposite. AI capex hype is still running hot after Meta posted record quarterly revenue of $64.2 billion and narrowed its full-year capex guidance to $135-145 billion. The logic goes: more AI spending means more chips, means buy semis. Bloomberg Daybreak also flagged that Tesla cut its capex from a prior target of over $25 billion down to roughly $20 billion, which actually rattled Asian chip stocks, dragging Resonac down as much as 12% in a single session. So the AI capex story is not uniformly bullish for hardware. It matters who is spending and where.
The bull case for $AMD and $MU is real: AI compute demand is still structurally growing, supply constraints are keeping pricing firm, and a broader Nasdaq recovery could lift the whole sector. But the bear case is getting louder. Memory price increases are reportedly slowing, Samsung and SK Hynix dropped around 5% on that news alone, and LRCX breaking down is a credibility hit for anyone calling a clean semiconductor recovery right now.
TheChartGuys note that rotation is the dominant market theme this week, with money flowing into defensive sectors like financials rather than high-beta tech. That's not a catastrophe, but it's also not the environment where you want to catch a falling chip stock barehanded.
If $AMD reports earnings and guides conservatively on AI chip demand, the LRCX breakdown stops looking like a one-off and starts looking like a pattern. Watch that report like it owes you money.