Wall Street isn't the only victim of the U.S.-China trade war.
The FXI China large-cap ETF has plunged nearly 9% in the past week, while China's BATS stocks — Baidu, Alibaba, Tencent and Sina — have all lost double-digits as trade tensions reached a boiling point. By comparison, FANG stocks — Facebook, Amazon, Netflix and Goofge parent Alphabet — have seen around half the losses.
Chinese tech stocks should continue to lag the rest of the market, says Ari Wald, head of technical analysis at Oppenheimer.
"We think the opportunity is on the U.S. side — U.S. tech — and we think the risk is in China tech," Wald said Monday on CNBC's "Trading Nation." Looking at the relative ratio of the S&P 500 versus the iShares China ETF FXI, "the S&P 500 is breaking out to the upside. We see this as the resumption of U.S. leadership."
Two names could be a buy-and-hold opportunity, though, says Wald.
"Tencent and Alibaba [have] a little bit more of just an ongoing trendless range. … I think that caution is warranted but I don't want to get emotionally attached to a bearish view because I do see at least long-term potential — at least versus its peers in those names," said Wald. "Avoid China but even selectively in that group there's some that look worse than others."
Gina Sanchez, CEO of Chantico Global, sees some bifurcation in the Chinese tech space highlighted by those four stocks.
"Take Baidu as an example of a bearish call. Baidu has basically put out a very debt-laden version of content acquisition. It's a big bet and it's going into a potentially slowing economy, so if you have growth rolling over it's not really a great name to own," said Sanchez. "Alibaba, on the other hand, is trying to open its doors to U.S. sellers onto its platform so it is actually taking a contrary play."
Chinese search engine Baidu is the worst performer this year, falling 37% as the FXI China ETF has dropped 2%. Blogging site Sina has declined 36%, while marketplace Alibaba and social media site Tencent have risen 12% and 6%, respectively.
"I would agree with the split as Ari has put it, which is … Alibaba and Tencent as more domestically oriented with fundamentals that aren't necessarily bearish – I'm not saying they're bullish but they're not necessarily bearish either," said Sanchez.