Thousands of export approvals are facing delays due to confusion within the US government, impacting US exporters. The US Commerce Department is reportedly dealing with its worst backlog in over thirty years. Nvidia’s AI chips are particularly affected, with no new export licenses issued this week. This situation jeopardizes billions of dollars in AI chip orders.

Deeper Issues Within The Department

These ongoing export licensing delays highlight deeper problems within the department. It’s unclear how long this backlog will impact US exports. This development brings significant uncertainty to the tech sector in the coming weeks. We can expect increased implied volatility, making options pricier yet more effective. Traders should brace for sudden price swings driven by headlines instead of smooth trends. Nvidia is at the heart of this situation, having already seen its stock drop 4% in the last two trading days of July 2025. Since nearly half of Nvidia’s revenue last year came from international sales, buying puts with September 2025 expirations seems like a smart way to protect against further losses if these licensing delays continue. This issue extends beyond Nvidia; it affects the entire sector. The VanEck Semiconductor ETF (SOXX) has already declined by 3.5% since its peak in July, indicating that the market is starting to factor in this risk. This shows the negative sentiment is spreading beyond just one company.

Market Precedents And Strategy

We’ve seen similar situations before during the 2018-2019 trade disputes. At that time, chip stocks experienced quick corrections of 10-15% based on tariff-related news, even if orders were only delayed, not canceled. History suggests the market tends to sell first and ask questions later. Given the unpredictable nature of the situation, any positive news could lead to a rapid recovery, making shorting stocks risky. Using defined-risk strategies like put spreads allows us to bet on a decline while limiting our maximum loss. This backlog is a clear obstacle for the Nasdaq 100, considering its heavy tech focus. The VIX has already risen from its summer low near 14 to over 18 this week, indicating that traders are actively seeking protection. Watch for potential weakness in Nasdaq futures (NQ) as a broader reflection of this trend. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now