Memory chip stocks dumped on glut fears — contrarian bounce play on Micron
Thesis
The Yahoo Finance story about SanDisk and Micron sinking on supply-glut fears seems overblown when you cross-reference it with the Bloomberg report that SK Hynix is raising $29 billion in a US listing to compete in 'memory chips used in AI computing.' If one of the world's largest memory makers is betting that big on AI-driven demand, the supply-glut narrative may be exaggerated. Add the fact that Trump publicly praised Micron while personally holding the stock, and you have a setup where the sell-off creates a buying opportunity — political tailwind plus long-term AI demand outweighing short-term supply fears.
Strategy approach
Build a mean-reversion strategy that enters long MU on D1 when the stock drops more than 3% in a single session while the 14-day RSI falls below 35. Exit on a 5% gain or after 10 trading days. Add a secondary entry condition if MU bounces off its 50-day moving average.