Chip Fear Floods the Options Pit

The AI sell-off is driving a sharp shift in options positioning. Chip names top both sides of the flow table — but the bearish bets are winning the volume war.

NVDA sits at the centre of the storm. The Nasdaq 100 briefly fell into correction territory this week. SK Hynix missed earnings expectations, rattling the entire memory and AI supply chain. MU options saw the heaviest negative flow among large caps. The stock is up 187% year-to-date — giving hedgers plenty of profits to protect. Short interest on MU sits at just 3.2% of free float, meaning put buyers are not classic short sellers. They are longs buying downside protection.

SMCI tells a different story. Short interest sits at 16.3% of free float. Its short score of 62.8 is among the highest in the sector. Options flow on SMCI is two-sided and volatile. Availability of shares to borrow is still ample at 172%, so fresh short positions remain easy to establish.

META heads into its Q2 earnings print with an RSI of just 43 and a 10% year-to-date loss. Bearish options bets are elevated. Analysts still see 39% upside from current levels — but markets clearly disagree right now.

AMD is the outlier. Up 112% year-to-date, it leads bullish options flows among semis. Bulls appear to be betting that AMD can decouple from the broader AI hardware panic.

Hedge funds are facing collateral calls as AI positions unwind. Options markets are pricing that stress in real time.

This is not financial advice.