Direxion Daily Semiconductor Bull 3x Shares (SOXL) experienced a significant 24-hour plunge of 5.26% during overnight trading on Thursday. The triple-leveraged ETF, which tracks and amplifies movements in the semiconductor sector, was caught in a broader market downturn.

The decline was driven by an extended selloff across the semiconductor sector, with memory stocks bearing the brunt of heavy selling pressure. Key factors contributing to the sector weakness include Korean regulators announcing higher minimum deposit requirements for chip leveraged ETFs and a Bank of America fund manager survey revealing that 82% of respondents identified long semiconductor positions as the most crowded trade currently.

Hedge funds have been net sellers of chip hardware stocks for consecutive weeks, intensifying the liquidation wave. As a triple-leveraged product, SOXL amplifies the underlying Philadelphia Semiconductor Index movements by three times, meaning the sector-wide selling pressure was significantly magnified in its decline.