Applied Materials Plunges 2.76% Intraday—What’s Behind the Sharp Selloff?

Summary
• Applied Materials (AMAT) slumps to an intraday low of $185.13, a 2.76% drop from its 2025 open
• Jim Anderson’s board appointment sparks mixed market sentiment amid sector-wide volatility
• Options chain shows heavy put buying at the $180 strike as traders hedge downside risk

Applied Materials’ stock is under pressure in the July 22 pre-market session, with a 2.76% intraday decline dragging it to a 52-week low of $185.13. The selloff follows a high-profile board appointment and intensifying sector-wide jitters. As the semiconductor equipment sector grapples with macroeconomic headwinds, AMAT’s technicals and options activity suggest a critical inflection point.

Boardroom Shake-Up Meets Market Skepticism
The appointment of Jim Anderson to AMAT’s board, while adding strategic credibility, coincided with a broader selloff in tech-sensitive assets. Anderson’s resume—spanning Coherent Corp, Lattice Semiconductor, and AMD—positions him as a semiconductor industry stalwart, yet the market interpreted the move as a defensive maneuver amid sector headwinds. With AMAT’s price dropping below key support levels and the 30-day moving average at $183.84, investors are questioning whether the board reshuffle aligns with near-term operational execution risks.

Semiconductor Equipment Sector Sinks with Lam Research
The Semiconductor Equipment sector is underperforming, with Lam Research (LRCX), AMAT’s sector leader, plummeting 3.57% intraday. The sector’s broad decline reflects investor caution ahead of Q3 earnings and amid geopolitical tensions in chip supply chains. While AMAT’s fundamentals remain robust (23.16 P/E, 40.15% ROE), the sector’s bearish momentum suggests macroeconomic factors—rather than company-specific news—are driving the selloff.

Options Volatility and ETF Positioning Signal Tactical Opportunities
• 30D MA: $183.84 (below current price)
• 200D MA: $171.11 (strong support)
• RSI: 66.1 (neutral)
• MACD: 5.98 (bearish divergence)
• Bollinger Bands: $175.18–$204.19 (wide range)

Technical indicators suggest AMAT is in a short-term bearish phase but remains within a long-term trading range. Key support levels at $183.84 (30D MA) and $171.11 (200D MA) could determine near-term direction. The options chain shows heavy put buying at the $180 strike, indicating institutional hedging. For aggressive downside plays, the AMAT20250801P180 (strike: $180, IV: 35.95%) offers 95.51% potential return under a 5% price drop to $178.43. This put option’s 0.0142 gamma and 0.2436 delta suggest sensitivity to price moves, while its high turnover (27,316) ensures liquidity. For a balanced risk-reward, the AMAT20250801P177.5 (strike: $177.5, IV: 35.85%) provides 73.13% potential return with a 0.1785 delta and 0.0224 gamma, making it ideal for volatility-driven strategies. Both options align with a bearish thesis, leveraging AMAT’s elevated IV and technical breakdown.

Backtest Applied Materials Stock Performance
The backtest of AMAT's performance after an intraday plunge of at least -3% shows favorable short-to-medium-term gains. The 3-Day win rate is 56.20%, the 10-Day win rate is 57.69%, and the 30-Day win rate is 61.82%, indicating a higher probability of positive returns in the immediate aftermath of such events. The maximum return during the backtest period was 8.26% over 30 days, suggesting that while there is some volatility, there is also potential for recovery and growth.

Intraday Selloff Tests AMAT’s Resilience—Act Now on Key Levels
The 2.76% intraday drop tests AMAT’s ability to hold critical support levels. With the sector leader Lam Research (LRCX) also down 3.57%, macroeconomic pressures are amplifying short-term volatility. Traders should monitor the $183.84 (30D MA) and $171.11 (200D MA) levels, as a breakdown below $171.11 could trigger a 10% correction. For positioners, the AMAT20250801P180 put offers a high-leverage hedge against further declines. Aggressive bulls may consider waiting for a bounce above $189.69 (middle Bollinger Band) before re-entering long positions.