Investing.com -- The technology sector's momentum unwind has further to run, with BTIG technical strategist Jonathan Krinsky warning of approximately 9%-10% additional downside risk for tech stocks and up to 14% more for semiconductors.

Krinsky said last week's selloff was an inevitable consequence of extreme positioning.

"It went the way it had to, the way it was always going to," he wrote, noting the XLK ETF posted a negative outside week and a clear rejection of new highs, which Krinsky described as the mirror image of the early April candle that launched the multi-month rally.

Prior to the selloff, the technology sector carried an 82 RSI reading and sat 28% above its 200-day moving average.

Krinsky said a pullback to the 50-day moving average would be a normal outcome and "suggests there is still ~9% downside risk at a minimum."

For semiconductors, the SOXX ETF retains approximately 14%-17% downside to its 50-day moving average, which Krinsky described as a reasonable target.

High-beta momentum suffered its worst single-day loss since COVID-19 on Friday, declining approximately 9.5%-10%. BTIG sees long/short momentum factor unwind risk of a further 11%-12%.

On the other side of the rotation, Krinsky highlighted healthcare and financials, the two worst-performing S&P 500 sectors year to date through June 2, as beginning to break out of multi-month bases. REITs and consumer staples also strengthened.

"The historic dispersion we saw over the last couple of months has started to unwind, and we think there is more to go before things settle down," Krinsky wrote.