One stock has fell short of chipmakers' big comeback.
Nvidia remains nearly 50 percent below its 52-week high set back in October, while the SMH semiconductor ETF is around 10 percent from sealing its own new record.
Todd Gordon, founder of TradingAnalysis.com, sees a bigger break lower for the semis stock.
"You can see that we're in a fairly well established downtrend here in Nvidia," said Gordon. "I don't even think we've retraced a third of what we've lost since the 2018 high… not even a quarter of what we've lost from the high. That shows relative weakness."
The Nasdaq 100 QQQ ETF, by comparison, has retraced around 61 percent of its decline from highs in September, while the SMH ETF has seen a retracement of more than three-quarters its loss, Gordon adds. The QQQ ETF is less than 8 percent from its highs.
"On top of that, what we'll see is Nvidia has traced out the classic three wave corrective pattern," he said. "The primary trend is clearly down at this point. We've bounced from $130, you've gone up, the volume was ok, it wasn't great on the bounce, sold back down on a gap here and now we're coming back for a three wave move."
Nvidia looks to be in the middle of an Elliott Wave movement, a technical theory that maps out prices moves based on investor behavior. In this formation, it could see the last of the three corrective waves that typically form, meaning further downside.
"I want to just try to get down and retest these lows around the $130 level," he added.
A move down to $130 represents a 16 percent decline from Thursday's close.
To play for a move to the downside, Gordon is buying the March 150/145 put spread for $1.25. This is a bearish bet that targets a move to $145 in the new two weeks.
"That's a $5 put spread. Max potential profit will be that $5 subtracted from the premium that we must pay which is $1.25 so simply $125 risk to potentially make $375 reward. A very nice trade," said Gordon.