Quick Read
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Cramer flagged AMD’s 8% and NVDA’s nearly 5% intraday drops as leverage-driven liquidations, not a deterioration in the underlying chip cycle.
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AMD’s 144% and Intel’s 150% year-to-date gains loaded leveraged books with profits that margin desks are now forcing them to sell.
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Retail isn’t flinching, with AMD scoring 82 (Very Bullish) and NVDA 62 (Bullish) on Reddit sentiment even as institutions layer on downside protection.
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Jim Cramer is telling investors to brace for more downside in semiconductors, and his reasoning has less to do with fundamentals than with the mechanics of who is doing the selling. In a post on X on July 27, 2026, the CNBC Mad Money host flagged the intraday reversal in chip stocks as “very difficult to reverse” because the sellers driving it are, in his words, “monstrous, motivated and often margined”. Translation: leverage is forcing the selling.
The intraday action confirms Cramer’s read. NVIDIA (NASDAQ:NVDA) was down 4.92% intraday, Advanced Micro Devices (NASDAQ:AMD) was off 8.31%, and Intel (NASDAQ:INTC) shed 3.54%. The VanEck Semiconductor ETF (SMH) fell 4.06%, taking its one-month decline to 9.33%. That is a broad, sector-wide reversal, exactly the kind of move that triggers risk-management protocols at levered funds.
Why Margined Sellers Matter
Margin calls do not care about earnings quality. When leveraged books get hit, positions get liquidated regardless of the underlying story. NVDA’s full-chain put/call ratio sits at 0.74, with the near-dated July 29 expiry running hotter at 0.92 and February 2027 puts spiking to 2.78. That is the fingerprint of institutions layering in downside protection ahead of earnings, and it is consistent with Cramer’s warning that positioning is calling the shots this morning.
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The Fundamentals Cramer Isn’t Disputing
Here is the tension. The chip cycle Cramer is trading around is arguably the strongest on record. NVIDIA’s Q1 FY2027 report showed revenue of $81.61 billion, up 85.2% year over year, with Data Center revenue of $75.25 billion (up 92%) and $119.0 billion in total supply commitments. Management guided Q2 to roughly $91.0 billion in revenue and authorized an additional $80 billion buyback, per the company’s Q1 FY27 filing.
