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I’ve been watching something unfold in the semiconductor space that’s got me thinking differently about where to park my capital for the rest of this run.
Semiconductors have run so far, so fast — names like VanEck Semiconductor (SMH), iShares Semiconductor (SOXX), and Intel (INTC) have been absolutely ripping. But here’s the thing: I’m actually hoping we get a violent pullback.
I know that sounds contrarian, but stay with me. After a move this stretched, the healthiest thing that can happen is a reversion that clears out the excess.
I’m hoping semiconductors start behaving a lot more like commodities, where you get those sudden, flashy speed crashes that reset the tape and give you real entries rather than emotional chases.
Why Hot Money Is Flooding Into Semiconductors
A lot of what’s powering this run isn’t just enthusiasm — it’s rotation.
Profits coming out of the Magnificent Seven (MAG7) are getting funneled straight into the racier corners of the market. That hot money flow has poured gasoline on the semiconductor rally and explains why the group has been moving with such incredible velocity.
There’s nothing wrong with that — it’s just how money cycles through the market. But it also means this rally rests on narrow, concentrated leadership.
The market needs the MAG7 to at least stay stable for this backdrop to hold. If they slip, the whole structure becomes vulnerable because so many sectors are lagging.
Technology (XLK) has dragged the S&P 500 (SPY) higher while nearly every other sector trails the index. That disconnect creates opportunity, but it also creates risk.
That’s why I don’t want to chase semis here. I’d rather wait for the inevitable pullback, let the air come out, then step in at levels that make sense.
Preparing for the Next Rotation
If we do get that speed crash — and I think we will — that’s where I want to reload.
And there’s more opportunity forming beneath the surface. As this next leg higher develops, I’m eyeing the catch-up trades.
Small-cap AI names and small-cap semiconductor plays are well positioned for outsized gains once the megacaps drift sideways and capital starts looking for new places to run.
At the same time, it’s worth noting something that gets lost in the noise: Even with prices ripping to new highs, some of the biggest technology names actually have lower forward P/Es today than they did earlier in the rally.
Earnings have simply been that strong. So while sentiment screams bubble, the math paints a more nuanced picture.
Still, I’m not in the mood to chase. I’m much more interested in parking profits in the stable, boring stuff while using income strategies to stay involved without taking on unnecessary risk.
Give me a deep in-the-money call so I can run a poor man’s covered call. Let me turn stability into steady income rather than trying to nail tops and bottoms.
And as for the fast movers? I’m still selling a lot of puts on Nvidia (NVDA).
That’s patience with premium — getting paid to wait for the dip rather than forcing a bad entry.
If semiconductors give us the pullback I’m expecting, that’ll put me right where I want to be.
This market still has room to run, but the leadership is narrow and the rotations are violent.
Don’t chase what’s stretched — let the speed crash come to you.
I’ll see you in the markets.
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Chris Pulver
Chris Pulver TradingÂ
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P.S. Wall Street Is Moving Money Right Now for SummerÂ
The next couple of months could bring some very unusual market action.
Every summer, Wall Street tends to shift capital into a different group of stocks while many traders are still focused on the usual names.
The interesting part?
These rotations aren’t random.
After more than a decade of research, trade data, and seasonal market analysis…
Jack Carter built a detailed Summer Stock Calendar designed to track when certain stocks have historically started moving.
It includes specific stocks, specific setups, and even the periods where momentum has tended to appear most often.
He revealed the full breakdown during the Summer Stock Roundtable earlier today.
If you missed it, you still have another chance to access it free.
Inside, you’ll see:
- Stocks historically favored during the summer rotation
- Key dates tied to potential momentum shifts
- Setups he’ll be watching closely over the next few months
No guarantees in trading, of course.
