Intel Plunges 3.2%: Can the Chip Giant Reclaim Its Mojo?

Summary
• Intel’s stock slumps to $22.73, a 3.2% drop from its 2025 opening price of $23.50.
• Intraday volatility sees shares trade between $22.67 and $23.57, with $22.73 as the latest print.
• Legal victory fails to calm investors as foundry woes and earnings uncertainty weigh.
Intel’s 3.2% intraday decline has sent shockwaves through the semiconductor sector. With the stock trading near its 52-week low of $17.67 and facing a critical earnings report on Thursday, the move reflects growing skepticism over CEO Lip-Bu Tan’s turnaround strategy and the company’s ability to compete with rivals like AMD and Nvidia. The recent dismissal of a $32 billion lawsuit over foundry losses adds complexity to a narrative already plagued by operational struggles and market-share erosion.

Earnings Anxiety and Foundry Uncertainty Fuel Selloff
Intel’s intraday selloff stems from a confluence of factors: a looming earnings report with dim guidance, ongoing foundry business challenges, and a broader sector rotation toward AI leaders like AMD and Nvidia. The recent federal court dismissal of a shareholder lawsuit over a $32 billion plunge in market value has failed to reassure investors, who remain wary of Intel’s $7 billion fiscal 2023 foundry loss and Tan’s proposed shift to 14A manufacturing technology. Analysts highlight that while the company’s $10.9 billion Products segment is expected to decline year-over-year, the Foundry business—despite a 2% revenue rise—continues to hemorrhage value. This, coupled with a lack of clarity on AI chip competitiveness, has triggered profit-taking and short-term bearish sentiment.

Semiconductor Sector Diverges: AMD Leads, Intel Trails
While Intel’s stock languishes, Advanced Micro Devices (AMD) has surged 2.26% intraday, reinforcing its position as the semiconductor sector’s standout performer. AMD’s 16% year-to-date gain contrasts sharply with Intel’s 29% annual decline, underscoring investor preference for companies with clearer AI and CPU growth trajectories. Intel’s market cap ($101 billion) remains dwarfed by AMD ($257 billion) and Nvidia ($4 trillion), compounding doubts about its ability to fund innovation or attract partners in the AI race. The sector’s focus on next-gen chip demand and manufacturing efficiency further isolates Intel’s foundry struggles.

Options and ETF Plays for the Intel Earnings Crossroads
• MACD: 0.488 (Signal Line: 0.518, Histogram: -0.030) suggests weakening bullish momentum.
• RSI: 65.51 indicates moderate overbought conditions but not extreme.
• Bollinger Bands: Current price ($22.73) sits near the lower band ($21.81), signaling oversold territory.
• 200D MA: $21.82 (current price above) offers short-term support.
Intel’s technicals point to a potential bounce from key support levels but remain clouded by earnings uncertainty. The SPDR S&P Semiconductor ETF (XSD) is a relevant proxy for sector sentiment, though no leveraged ETFs are tied to Intel per the data provided. For options, two contracts stand out:

• INTC20250801P22.5 (Put Option):
- Strike: $22.50, Expiration: 2025-08-01
- IV: 72.93% (high volatility), Leverage Ratio: 24.68% (moderate), Delta: -0.4416 (sensitive to price drops), Theta: -0.0093 (slow time decay), Gamma: 0.1517 (high sensitivity to movement), Turnover: $307,330
- Payoff Calculation: A 5% downside to $21.59 yields max payoff of $0.91 per share. This contract benefits from a sharp decline and high gamma, making it ideal for aggressive bearish bets.
• INTC20250801P23 (Put Option):
- Strike: $23.00, Expiration: 2025-08-01
- IV: 75.58% (elevated), Leverage Ratio: 18.61% (moderate), Delta: -0.5157 (strong bearish exposure), Theta: -0.0032 (minimal time decay), Gamma: 0.1479 (high sensitivity), Turnover: $190,804
- Payoff Calculation: A 5% drop to $21.59 generates max payoff of $1.41 per share. This option offers a balance of leverage and liquidity for a moderate bearish outlook. Aggressive bears may consider INTC20250801P22.5 for a sharp drop, while INTC20250801P23 offers a safer floor if the stock stabilizes near $23.

Backtest Intel Stock Performance
Intel (INTC) has historically shown positive short-to-medium-term performance following a -3% intraday plunge. The backtest data reveals that:1. Frequency and Win Rates: Such events have occurred 626 times over the past five years, with a 3-day win rate of 51.76%, a 10-day win rate of 55.43%, and a 30-day win rate of 52.56%. This indicates a higher probability of a positive rebound in the immediate aftermath of a significant intraday decline.2. Returns: The average 3-day return following the event is 0.19%, with a maximum return of 0.52% on day 14. The 10-day return is slightly higher at 0.23%, with a maximum return of 0.67% on day 21. While the 30-day return is slightly negative at -0.04%, the overall pattern suggests that Intel tends to recover and even surpass its pre-plunge levels in the short term.3. Maximum Return Days: The maximum return following a -3% intraday plunge occurs predominantly within the first 30 days, with the highest returns observed on days 14 and 21. This suggests that holding Intel for a short period after such an event can be beneficial, as the stock often rebounds strongly.In conclusion, Intel's performance after a -3% intraday plunge is generally positive, with a higher likelihood of recovery and even higher returns in the short term. This makes it a potentially attractive opportunity for traders looking to capitalize on volatility in the stock's price.

Earnings on the Horizon: A Make-or-Break Moment for Intel
Intel’s 3.2% decline underscores the fragility of its current position, with earnings on Thursday acting as a pivotal catalyst. Short-term support at $21.81 and resistance at $23.30 will be critical in determining whether the selloff is a buying opportunity or a deeper breakdown. The sector’s shift toward AMD and AI-focused players highlights the urgency for Intel to deliver a credible path to profitability. Investors should monitor the $23.30 level as a psychological hurdle—failure to reclaim it could signal a return to 52-week lows. For now, the options market and technicals suggest a cautious stance, with INTC20250801P22.5 and INTC20250801P23 as key contracts to track. Watch AMD’s 2.26% rise as a barometer for sector sentiment.