Markets are centered on Fed messaging into the next rate decision on the 15th and Friday’s jobs report, while SPY is losing trend quality after slipping into the bottom half of its ascending channel. AVGO is the main AI stock focus: earnings matter less than forward AI guidance, customer concentration, supply, margins, and whether Hock Tan raises outlook or just repeats old targets. On the chart, AVGO sits below key moving averages but has a clear upside path if it reclaims 378, 385, and then 410-412; failure at 364/356 opens 336. The broader call is cautious on SPY and tactically bullish on AVGO only if the earnings call and guidance surprise to the upside.
Fed messaging is the market’s focus into the next rate decision on the 15th, with Friday’s jobs report expected to move price immediately.
Fed commentary said policy rates are already in a good place to handle problems ahead, so rates need to stay higher for longer while inflation stays elevated.
The labor market was called solid and the number one indicator to watch under the Fed’s dual mandate.
SPY failed to push higher until RSI got above 60%, then got rejected after another attempt and has since come down.
SPY was trading in a large ascending channel, found support at the middle of that channel, then slipped into the bottom half; that is labeled bear territory even after a green candle.
If SPY cannot get back into the top half of the channel tomorrow, the call is for more fade toward 753, with 753 described as a long-term target under a brand new high near 783.
AVGO is being treated as a key AI name, and the market wants more than an earnings beat: it wants strong forward AI guidance.
Wall Street already expects AVGO to show roughly $29 billion in revenue and $16 billion from AI chips, so the conference call matters more than headline results.
The main AVGO questions are whether Google is shifting future chip design and supply contracts to rivals such as MRVL, whether AVGO can secure enough supply without crushing margins, and whether VMware is becoming a cash machine or losing customers.
If Hock Tan raises the forward outlook, the algorithms are expected to go wild; if he repeats old targets, AVGO could beat earnings and still get crushed.
On AVGO’s daily chart, the 200-day moving average around 364 is the key springboard; the 20-day at 378 and 50-day at 385 are the first bullish levels.
A move to 385 would complete a bullish inverse head and shoulders on a smaller timeframe, with 410 as the next upside target and 410-412 marking a return to the long-term uptrend.
If AVGO loses 364, the next pivot is 356; a break below 356 opens 336 as the nearest significant structure.
Positive news tonight could produce a massive green candle that carries AVGO from the bottom of its large range toward the top of the range.
AVGO is called a great investment, and if a bad earnings event drives it near 336, long interest would be considered and put selling below 336 could help fund a long-term portfolio.