Michael Burry is warning that Wall Street’s longest calm streak in three decades is a red flag. The calm has held even as a small group of AI-linked mega-caps drives most of the market’s gains.
Burry predicted the 2008 housing collapse and is a known skeptic who often sees his calls come true. He says this streak echoes warnings he has made since November 2025.
A Record Streak Without a Selloff
BTIG technical strategist Jonathan Krinsky tracks a specific signal. He measures days when at least 80% of New York Stock Exchange (NYSE) volume comes from falling stocks.
Wednesday marked the 182nd straight session without one of those days. Historically, this is the longest streak in at least three decades, and nearly 50 sessions longer than the previous record.
Krinsky notes that every year in the past three decades has recorded at least five of these sessions. A full 2026 without one would mark a first.
“That sort of technical factor on its own is easy to ignore. However, I have been writing about fundamental reasons for something like this to happen since November of 2025.”
Why the Calm Might Be an Illusion
In contrast to broad-based rallies, a handful of AI stocks now drive most index gains. Burry has flagged concerns about Nvidia (NVDA), Micron Technology (MU), Caterpillar (CAT), Palantir Technologies (PLTR), and Tesla (TSLA).
He holds bearish positions against several of these companies, including Nvidia and Micron. Passive index funds also carry heavy weightings in these same AI names, amplifying the swings.
Burry has made similar warnings before. He compares today’s setup to his earlier 1987 crash warning and the dot-com peak. In both cases, narrow leadership eventually gave way to broader selling.
The Leverage Warning from Burry
However, Burry’s core message is not about timing the turn. It is about surviving it.
“The trick is to avoid stepping into someone else’s folly along the way. Avoid the leverage, and one is more likely to avoid the folly.” Burry said.
Large market cycles can take months or years to unwind, Burry says. Therefore, leverage becomes the real danger for investors waiting it out.
Situational Awareness, an AI-focused hedge fund run by Leopold Aschenbrenner, sold its public stock portfolio to Citadel last month. Meanwhile, steep losses on chip and data center stocks, including SK Hynix, forced the move.
Whether the calm breaks before the mega-caps do is the question Burry is betting on.
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