Intel Surges 8% on Analyst Upgrade: AI Demand and Foundry Hopes Ignite Bullish Sentiment

Summary
• KeyBanc upgrades Intel to 'Overweight' with $60 price target
• Intel's server CPUs 'almost sold out' for 2026, pricing power emerges
• 18A manufacturing process gains traction, Apple partnership rumors resurface
Intel (INTC) has surged 8.11% intraday, trading at $47.64 as of 20:16 ET, driven by a KeyBanc analyst upgrade and renewed optimism around AI-driven demand. The stock has pierced its 52-week high of $48.24, with turnover hitting 143 million shares—3.4% of its float. This marks the second major rally in a week, following a 6.6% jump after CES 2026 product announcements. The move reflects growing confidence in Intel's ability to capitalize on the AI server boom and manufacturing turnaround.

KeyBanc Upgrade and AI-Driven Demand Fuel Intel's Surge
KeyBanc analyst John Vinh upgraded Intel to 'Overweight' from 'Sector Weight,' citing explosive demand for its data center server CPUs and progress in its 18A manufacturing process. Vinh highlighted that Intel is 'almost sold out' for 2026, with potential ASP increases of 10-15%, and noted supply chain checks indicating a rumored Apple partnership to use 18A-P for low-end Mac/iPad chips. These developments, coupled with improving 18A yields and AI packaging opportunities, have reignited investor enthusiasm. The upgrade follows Intel's recent CES 2026 product launches and a strategic partnership with Nvidia, reinforcing its position in the AI infrastructure race.

Semiconductors Sector Mixed as TSMC Trails Intel's Rally
While Intel's stock soars, the broader semiconductors sector remains fragmented. TSMC (TSM), the sector's leader, has risen just 0.065% intraday, reflecting divergent investor sentiment. TSMC's muted performance contrasts with Intel's AI-driven optimism, as foundry peers like Samsung and SK Hynix focus on 8-inch wafer capacity cuts and AI packaging investments. Intel's rally underscores its unique positioning in the AI server CPU market and manufacturing turnaround narrative, while TSMC's steady but unremarkable move highlights sector-wide caution amid global supply chain adjustments.

Leveraged ETFs and Options Playbook: Capitalizing on Intel's Bullish Momentum
• Direxion Daily INTC Bull 2X ETF (LINT): 16.2% intraday gain, ideal for amplifying long exposure
• GraniteShares 2x Long INTC Daily ETF (INTW): 16.2% surge, leveraged to track INTC's daily performance
• Technical Indicators:
- RSI: 73.5 (overbought)
- MACD: 1.357 (bullish divergence)
- 200-day MA: $28.07 (far below current price)
- Bollinger Bands: Price at $47.64 vs. upper band $44.16 (overextended)
Intel's short-term bullish trend aligns with leveraged ETFs like LINT and INTW, which have surged 16.2% today. For options, two contracts stand out:

INTC20260123C42
• Call Option, Strike: $42, Expiry: 2026-01-23
• IV: 70.98% (high volatility)
• Delta: 0.8429 (strong directional bias)
• Theta: -0.1931 (rapid time decay)
• Gamma: 0.0414 (high sensitivity to price moves)
• Turnover: 1.58M (liquid)
• Leverage Ratio: 7.58% (moderate)
Why it works: This call option offers high leverage to Intel's continued rally, with a 5% upside scenario (target $50) yielding a payoff of $8. This contract is ideal for aggressive bulls capitalizing on AI-driven momentum.

INTC20260123P42
• Put Option, Strike: $42, Expiry: 2026-01-23
• IV: 69.04% (high volatility)
• Delta: -0.1512 (moderate downside protection)
• Theta: -0.0313 (moderate time decay)
• Gamma: 0.0415 (responsive to price swings)
• Turnover: 109K (liquid)
• Leverage Ratio: 73.63% (high)
Why it works: This put offers downside hedging with high leverage, ideal for a volatile trade. A 5% upside scenario (to $50) would see the put expire worthless, but it provides insurance against a pullback while maintaining upside potential via the call.

Action: Aggressive bulls should pair the INTC20260123C42 call with a short-term stop-loss below $45.21 (intraday low). Conservative traders may use the INTC20260123P42 put as a hedge while holding long positions.

Backtest Intel Stock Performance
The backtest of Intel's performance after an intraday surge of at least 8% from 2022 to the present shows mixed results. While the 3-day win rate is 46.28%, the 10-day win rate is slightly lower at 45.87%, and the 30-day win rate is 50.62%, indicating a higher probability of positive returns in the short term. However, the maximum return during the backtest period was only 1.10%, which suggests that while there is a good chance of positive returns, the overall performance after the surge has been relatively modest.

Bullish Momentum Unlikely to Subside: Position for AI-Driven Growth
Intel's 8.11% rally is a clear signal of renewed investor confidence in its AI and foundry strategies. With KeyBanc's $60 price target and improving 18A yields, the stock is poised to test its 52-week high of $48.24 and potentially break out. The sector's mixed performance, highlighted by TSMC's 0.065% gain, underscores Intel's unique positioning in the AI server market. Investors should monitor the $45.21 support level and consider adding to positions via leveraged ETFs like LINT or INTW. For options traders, the INTC20260123C42 call offers a high-leverage play on continued AI-driven demand. Act now: Buy the call option and hold for a 5% upside target, or use the put for downside protection in a volatile trade.