Famed “Big Short” investor Michael Burry issued a warning to tech investors, sounding an alarm on the overheating semiconductor sector. He shared a market chart comparing the current chip rally to the absolute peak of the dot-com bubble, ominously stating, “History repeats.”
Echoes Of The 2000 Tech Crash
Burry’s social media post mapped the current trajectory of the Philadelphia Semiconductor Index, which is tracked by iShares Semiconductor ETF (NASDAQ:SOXX) and the Nasdaq 100, tracked by Invesco QQQ Trust (NASDAQ:QQQ), against their precise paths leading up to March 10, 2000—the historic peak of the dot-com crash.
The comparative data indicated that the recent two-month run-up to June 2 in 2026 flawlessly mirrors the hyper-extended vertical climb seen twenty-six years ago from March 2000 to June 2000, signaling an impending market correction.
An Unprecedented Extension
The warning comes just weeks after Burry disclosed a massive short position against the high-flying iShares Semiconductor ETF. On April 24, Burry revealed he purchased a significant number of January 2027 SOXX puts struck at $330. At the time of his trade, semiconductors were already trading at a highly extended 43% above their 200-day moving average.
Since his initial bearish play, the chip sector has continued to defy gravity. The gap between the sector and its long-term 200-day simple moving average of $338.86 has widened to an unprecedented 78.86% as SOXX rallied to $605.02, according to its Tuesday close.
This extension represents the largest trend deviation since the fund’s inception in July 2001, outpacing the distortions seen during the 2020 pandemic shock and the 2022 chip recession.
Underlying index components like Intel Corp. (NASDAQ:INTC) and Micron Technology Inc. (NASDAQ:MU) are also trading significantly above their moving averages.
A Technical Return To Earth
Despite the market continuing to rip higher against his puts, Burry remains unfazed by the short-term pain, viewing the explosive AI-driven hardware boom as fundamentally unsustainable.
“I know the SOX will return to earth. Older semiconductor guys know it too. What is happening now is technical,” Burry previously noted. Armed with a long runway until January 2027, Burry is betting that mean reversion will inevitably trigger a sharp drawdown.
How Has SOXX Performed In 2026?
In comparison with QQQ’s 21.70% year-to-date advance, shares of SOXX have advanced by 98.42% over the same period. It closed 5.79% higher at $605.02 apiece on Tuesday, and it was up 0.71% in overnight trading.
Over the last month, SOXX stock was up 29.90%, and it rose 103.77% and 190.83% over the last six months and the year, respectively. Benzinga’s Edge Stock Rankings indicate that SOXX maintains a strong price trend in the long, medium, and short terms, with a solid momentum score.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: Below the Sky via Shutterstock
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