Viewpoint: The semiconductor short positions may limit the rebound, optimistic about Chinese technology stocks and the cryptocurrency market

Trader degentrading (@degentradingLSD) released a pre-market analysis. Regarding semiconductors, he believes there are many trapped long positions in the sector, and unless a painful liquidation event occurs leading to a V-shaped rebound, any rebound will be limited by selling pressure as prices approach break-even; another possible path is company buybacks, and only MU has the capability to implement this before the expiration of the CHIPS Act-related ban on December 9. He cited Citrini's view that AI capital expenditure growth has peaked, but capital expenditure itself will not stop, just slow down; he personally believes that when growth is priced at zero, any outperformance will bring new upward momentum, thus seeing long opportunities, but he also acknowledges that stock prices may not have bottomed at the current position and could continue to decline.

In terms of AI computing power, he pointed out that the previous trading day saw cloud giants rise about 10% while semiconductors fell about 10%, with the market largely attributing this to potential obstacles in new data center construction in the U.S., which would increase the value of existing chips. H100 rents rose 26% year-on-year, GB200 rose 50%, and ORCL disclosed that AI infrastructure utilization reached 98%, which contradicts expectations of computing power depreciation. Regarding Chinese tech stocks, he believes that BABA's rise of about 10% could be a turning point, and if China introduces further policy measures or brings about a strong reversal, coupled with Chinese tech stocks being at historically low valuations.

In the cryptocurrency market, he believes BTC is performing strongly, and ZEC is maintaining its gains, with the industry's tailwinds returning as funds move away from the government's original intent. Under expectations of more hostile governments towards cryptocurrencies, policy pressure may actually strengthen the crypto narrative, while policy support could weaken its core supporters.