AI chip bubble springing a leak — short Super Micro as Samsung and SK Hynix plun
Thesis
The AI chip trade has been unstoppable, but we're seeing a perfect storm of negative headlines that could trigger a broader pullback. News of a smuggling probe hitting Super Micro signals regulatory risk is escalating. When combined with reports that Meta is looking to offload computing power (sparking fears of an AI infrastructure glut), the narrative is shifting from 'not enough chips' to 'too much capacity.' The fact that major Asian suppliers like Samsung and SK Hynix are already tumbling 7% suggests this isn't just a one-day blip, but a coordinated rotation out of the most crowded part of the market.
Strategy approach
Build a rule-based strategy that enters short SMCI on D1 when the stock closes below its 10-day low and the KOSPI index (or a Korean semiconductor ETF like SOXX) drops more than 3% on the same trading day. Exit the trade if SMCI closes above its 5-day high, with a hard 15% stop loss.