A Canary In The AI Coalmine

 The Dust Continues to Settle on the S. Korean Semiconductor Crash.

The Korean KOSPI index is down 10% in Asian trading hours. Down 35% since June 26th high. This what happens when the 2 biggest stocks are 50% of your index. pic.twitter.com/g5pB5GHjUo

— Edward Dowd (@DowdEdward) July 28, 2026

Ed Dowd makes a good point, and I think we're bound to see a similar unwind in the US - when the basket of AI driven stocks which accounts for 50% of the market gains over the past several years, unwinds. Hey, remember when NVIDIA used to lead the AI rally, then Semis, and a hand full of industrials names eg $CAT? Yeah... until FOMO turns to fear. Corning (reported this morning - stock -16% in pre-market?  So much for that bullish industrials narrative.

Getting back to the AI crash at hand

When they decide to pull the plug - it's usually on a Monday - this time it was Tuesday

Last night's crash in S. Korea was yet another orchestrated rug pull (bid lowered below support)- possibly orchestrated by the same offshore (Chinese) traders I alerted to a week ago [Chinese Reddit Traders Team Up To Help Create The Perfect Storm].

Look closely at the embedded chart, to see where the bid was lowered- just below support. Textbook. 

🚨 S. Korean $KOSPI is halted for 20 min. Waste of time. The damage has already been done. https://t.co/IYUUZGs1SA

— Veteran Market Timer (@3Xtraders) July 28, 2026

Thankfully I never got bullish on the KOSPI - I avoided catching a dreaded falling knife, but once the dust settles I'll be on board... because I trade whatever moves - not the $SPX. 

What else is moving: Tesla, SpaceX, AI stocks, Tech (as usual). These 2 are only indicators for the hyperscaler space; I don't short individual stocks - maybe someday... but I'm sure my accountant would disapprove. However, if I had shorted Tesla, you can bet your ass I would've already covered that bet. 

We're getting very close to my downside support. 

The target - called out, just before Tesla reported 

Tesla being drawn to my Tesla target - like a SpaceX booster recovery operation. $TSLA
"support... 295 - 300" 👇 https://t.co/uLv9knNmmC

— Veteran Market Timer (@3Xtraders) July 25, 2026

In Focus - The Rest of The Week: 

• Wednesday's FOMC announcement should drive the $VIX back to normal levels. I'm not even sure what's holding it up - to tell you the truth. This must be one hell-of-a bear trap..?  $MSFT, $META, $LRCX LAM, $QCOM QUALCOMM,  $ARM    

• Thursday more big tech earnings : $AAPL Apple, $AMZN, $MPWR (monolithic)
• Friday Energy $XOM, $CVX 

After so many rug pulls, and the lack of excitement around the AI narrative, I'm only looking for another relief rally to sell - unless we see a sentiment shift - continue to sell the rips. 

Mag7 Rout or Summer Swoon?

Yesterday's overly dramatized sell-off in Mag7 stocks, was very narrow in scope. My only gripe is that none of the leveraged bear ETFs even came close to capturing the 5% downside (rounded). 
 

None of the leveraged 3X ETFs are a pure MAG7 play. $MAGS was down 4.63%. None of the leveraged bears were up even 12%. $WEBS was up 8.15%, but only because of google. Buyer beware.

— Veteran Market Timer (@3Xtraders) July 23, 2026

Bloomberg was seen spiking the ball in the endzone immediately after the close - reporting the rounded up to 5% sell off -  because it was in fact their own Mag7 index that was targeted. Goldman quotes the same numbers, so all the usual suspects were on board... and which Mag7 name did the globalist banksters hit the hardest? No, not Apple.    

"$TSLA Tesla - the one the globalists love to hate - was hit the hardest. Remember my call Nov. 18th, when we dissected the Mag7 - in depth - in a blog series [link] - quote:     

"All Booms eventually go bust. Which one do you think will go to the pennies first? 

I think Apple, NVIDIA, & Google/ Alphabet are set to be crushed, but I think Tesla will lead the way... (lower). I know some of you will fight me on this, but it grew too fast, and you know he has a target on his back. They are out to get Elon."    

Then came the call that set the ball in motion

Top Fund Manager Warns Mag7 Stocks Will Drag Down the S&P 500  

The Mag 7's reign is ending. A top fund manager says that means trouble for the S&P 500. $SPX https://t.co/KEussvRc0M

— Veteran Market Timer (@3Xtraders) July 24, 2026

12 hrs. later mag7 index suffers its worst loss since April (many sources)   

I was lucky enough to see yesterday's rout coming, as I'm sure many did. This earnings season has been a sell the news event since Samsung reported. I even moved the 401k out of the direct line of fire. But at the end of the day nothing has changed. 

I went into today's session, net short. Even the 401k was moved out of the firing line at yesterday's close. Still bonds got whacked.

Canada still looks good. The NYSE only ended down -.19%. Its the $SPX, and the Nasdaq that's volatile, and probably going to stay that way.

Looks… pic.twitter.com/9rltZplTng

— Veteran Market Timer (@3Xtraders) July 23, 2026

Just Another Summer Swoon 

That's my take. Even the crude oil/energy rotation seems to have been perfectly timed.  Brent crude driven to the $100 (even number target) - now profit taking - one day after AI investors were robbed?😜

investing.com 

I would still keep the $VIX on a short leash, and be on the lookout for more rotations, within the AI space, but this looks like, just another summer swoon to me.