In this video: A massive divergence is splitting the semiconductor sector in two. In today’s My Trading Game Plan, Chief Market Strategist Gareth Soloway breaks down the chaos. While Intel (INTC) is in freefall—plunging 12% after a disastrous earnings report and weak Q1 guidance—Nvidia (NVDA) is acting as a life raft for the tech sector.
Reports have surfaced that China is clearing its tech giants, including Alibaba and ByteDance, to begin placing massive buy orders for the H200 chips. This news has sent NVDA higher, but is it enough to save a NASDAQ that has already cracked major trendline support? Gareth analyzes the "Battle of the Chips" and reveals the institutional levels you need to watch. Video by Gareth Soloway.
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As of January 23, 2026, the technology sector is experiencing a sharp divergence characterized by Nvidia's strategic re-entry into China and a significant market sell-off for Intel following a disappointing outlook.
Nvidia’s China "Breakthrough"
Nvidia's prospects have brightened following reports that Beijing is close to formally approving the import of its H200 AI chips.
--Market Re-entry: Chinese regulators have given "in-principle" approval for major tech firms like Alibaba, Tencent, and ByteDance to prepare orders for the H200.
--Performance Gap: The H200 offers approximately six times the performance of the previously permitted H20 chip, making it essential for training advanced AI models in China.
--Economic Impact: Analysts estimate that Chinese tech firms have already placed orders for over two million H200 chips, far exceeding Nvidia's current inventory.
--Political Context: This shift follows a 2025 decision by the U.S. government to allow the sale of more advanced AI chips to China, though the most powerful "Blackwell" chips remain restricted.
Intel’s 12% Market Crash
In contrast, Intel shares tumbled more than 12% (reaching as low as 16% in morning trading) on January 23, 2026, following its Q4 2025 earnings report.
--Weak Q1 Guidance: Despite beating Q4 revenue and earnings expectations, Intel issued a "soft" forecast for Q1 2026, with revenue projected between $11.7 billion and $12.7 billion—well below analyst consensus.
--Supply Constraints: The company warned of "acute" internal supply constraints in early 2026 due to depleted buffer inventory.
--Profitability Concerns: Investors are reacting to shrinking gross margins, expected to reach 34.5% in Q1 2026, and the lack of a clear timeline for meaningful revenue from its advanced 14A manufacturing process.
Can Tech Be Saved?
The outlook for the tech sector remains fragmented rather than universally dire:
--AI Resilience: While Intel struggles with manufacturing execution, the broader AI infrastructure market remains robust. Nvidia's stock rose on the China news, even as Intel dragged the Dow and S&P 500 lower.
--Manufacturing vs. Design: The "crash" is largely localized to firms failing to capture AI server share or those facing manufacturing bottlenecks.
--2026 Outlook: Analysts remain bullish on AI hardware leaders, with price targets for Nvidia projected as high as $390 later this year as it transitions to its "Vera Rubin" architecture.
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