“ARM doesn’t just participate in the AI buildout. It collects a toll on every chip that powers it.”

Nate Bear, Lead Technical Tactician, Monument Traders Alliance 

There’s a set of instructions buried inside virtually every smartphone, AI server, and cloud processor on earth.

They belong to one British company.

ARM Holdings (ARM) doesn’t manufacture chips. It designs the instruction set architecture, the blueprint that tells a chip how to execute code, and licenses that blueprint to every major chipmaker in the world.

Amazon’s Graviton cloud processors run on ARM. Apple’s M-series chips run on ARM. NVIDIA’s Grace and Vera CPUs, Google’s Axion, and Microsoft’s Cobalt all run on ARM.

None of those companies can build their flagship products without an ARM license. 

Not without rebuilding their entire software ecosystems from scratch. That’s not happening.

ARM doesn’t just participate in the AI buildout. It collects a toll on every chip that powers it.

NVIDIA reports after the bell tonight, and that matters to ARM for a specific reason. NVIDIA’s Grace and Vera CPUs, the processing backbone that pairs with NVIDIA GPUs in AI data centers, are both ARM-based.

Last month, NVIDIA opened its NVLink Fusion technology to third-party ARM processors, letting hyperscalers pair custom ARM-based CPUs directly with NVIDIA GPUs.

Every additional GPU cluster NVIDIA ships into an AI data center creates demand for more ARM-architecture CPUs alongside it.

If NVIDIA beats tonight and confirms the AI infrastructure buildout is accelerating, it directly confirms ARM’s royalty pipeline.

ARM’s most recent earnings showed data center royalty revenue more than doubled year-over-year. Total revenue for fiscal 2026 reached a record $4.92 billion, up 23%, marking the company’s third consecutive year of more than 20% revenue growth since going public. Full-year non-GAAP EPS was $1.77.

But the chart setup is beautiful.

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ARM is in a bullish stacked moving average setup on the daily and weekly timeframes.

Moving averages track the average closing price over a set number of days: the 20-day shows recent momentum, the 50-day shows the intermediate trend, and the 200-day defines long-term direction.

When the short-term averages sit above the longer-term ones with all of them pointing up, the stock is trending higher across every timeframe at once.

That is where ARM sits right now. The 20-day is at $213.37, the 50-day is at $171.94, and the 200-day is at $144.83. Current price at $223.15 is above all three and all three are pointing up.

RSI at 59.56 measures momentum on a scale of 0 to 100, where readings above 70 signal an overheated stock. At 59, ARM has momentum without being stretched.

Underneath that price action, a daily squeeze is forming. A squeeze happens when price compresses into a tight range, building pressure before a breakout.

When it releases on a stock that is already in a strong uptrend, the resulting move can be significant.

When a squeeze sets up on a name that’s already trending higher with stacked moving averages and a confirmed fundamental tailwind, that’s the cleanest version of my TPS framework: trend, pattern, squeeze.

I find that squeezes on stocks near highs tend to have explosive reactions.

Your Action Plan

ARM is on the watchlist because the structure is exactly what I hunt for every week.

A company that collects royalties on every AI chip shipped by Amazon, Apple, NVIDIA, and Google, posting record revenue for the third straight year, sitting within striking distance of its 52-week high with stacked moving averages and a daily squeeze forming.

NVIDIA reports tonight.

Last week I went 24 for 25. If you want to know what I’m trading this week, check out Daily Profits Live. Want more content like this?

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