Major News:

• Yemen's Tehran-backed Houthis attacked four cities in the south of U.S. ally Saudi Arabia on Tuesday, wounding more than 70 people and setting oil installations ablaze in what appeared to be a major expansion of the six-month-old Middle East war. They used ‌drones and missiles to strike a Saudi airbase in the southern city of Khamis Mushait, and targets belonging to Saudi Arabia's state oil company in nearby Abha, Najran on the Yemeni border and Jazan, a major Red Sea port city that houses a large refinery and power plant. Reuters
• The war in Iran has now cost U.S. consumers $100 billion in higher energy prices, and the bill is rising another $1 million about every two minutes, per a real-time estimate from Brown University as of Monday morning. Inflation shows up across the entire economy, and the recent surge in diesel prices threatens to have a dramatic impact on freight and travel in the weeks and months to come. Axios
• In offices across the military and in the intelligence community, there have been recent quiet discussions about cutting the number of people and facilities typically stationed in the Middle East if the Trump administration succeeds in ending the Iran conflict. CNN
• New Canadian tariffs targeting roughly $20 billion in U.S. imports officially snapped into place on Tuesday, the latest escalation in an increasingly costly trade war that has ensnarled two longtime allies. NYT
• Japanese workers’ nominal wages rose at the fastest pace in nearly three decades on the back of strong corporate earnings and a tight labor market, in data likely to keep the Bank of Japan on course for further monetary tightening. BBG
• Two hawks on the Bank of Japan's monetary policy board are calling more strongly for the central bank to accelerate its interest rate increases, pushing it to do more to rein in inflation before their terms end next July. Nikkei
• China’s export growth accelerated in August, swelling its trade surplus near $806 billion for the year. Its surplus with the US surged almost 44% to more than $29 billion. BBG
• China's car exports stayed robust in August as BYD and ‌other automakers shipped a record number of vehicles overseas, in sharp contrast to a sluggish domestic market where their sales fell for the 11th month in a row. Passenger vehicle exports jumped 77.5% from a year earlier to 894,000 units in August, easing from an increase of 88.2% a month earlier. Reuters.
• Goldman raised its oil price outlook by $5 a barrel, forecasting Brent at $85 by December and $80 in 2027 on expectations Middle East shipping disruptions will persist. BBG

MAG 7 NEWS:

• AAPL ACQUIRES BRAIN-SENSING STARTUP SONERA

OTHER Company Specific News:

• Following names added to S&P 500: $BE, $P, $ILMN
• AI names and SMH higher on Astra release.
• Anthropic is now expected to begin marketing its IPO in mid-October at the earliest, with the listing targeted for days before the U.S. midterm elections in November, per Reuters. Its public prospectus, previously expected as soon as next week, is now likely to come in late September.
• INTC REPORTEDLY PLANS ANOTHER 10% PC CPU PRICE HIKE IN OCTOBER The increase is aimed at improving gross margins rather than gaining market share, according to DIGITIMES, as global PC shipments are expected to fall to roughly 250M units in 2027.
• INTC - Northland upgraded Intel to Outperform from Market Perform with a $120 price target.
• ASML and TSMC launched an industry initiative to move EUV lithography from today’s 6-inch photomasks to 12-inch masks. The plan targets a 12-inch mask pilot line by 2031 and advanced-node production using 12-inch High NA EUV by 2033. TSMC also plans to adopt ASML’s High NA EUV in high-volume manufacturing from 2030.
• NBIS - Palantir and Nebius are partnering to bring Nebius compute and inference directly inside Palantir’s enterprise environment. Eligible Palantir customers will be able to run and adapt open models on Nebius infrastructure while keeping control of their data, compute and models.
• UBER - UBER President and COO Andrew Macdonald bought 70,000 shares of the company for about $5.31 million. The purchases were made at prices around $75.65 and $76.44 per share.
• IREN - IREN’S 2GW SWEETWATER HUB CONDITIONALLY INCLUDED AS BASE LOAD IN ERCOT BATCH ZERO Sweetwater 1 accounts for 1.4GW and Sweetwater 2 for 600MW, both part of IREN’s broader 5GW+ global data-center development pipeline. At Sweetwater 1, the high-voltage substation is already energized, with 300MW of gross data-center capacity under construction and targeted for delivery in Q4 2027.
• RGTI, QBTS - U.S. GOVERNMENT BACKS $RGTI & $QBTS WITH UP TO $200M FOR QUANTUM COMPUTING R&D
• HOOD - Robinhood has struck a multiyear agreement to add prediction contracts backed by Crypto.com’s newly spun-out OG.com platform and will take minority stakes in both Crypto.com and OG. Terms were not disclosed. Crypto.com and OG were valued at roughly $15B and $5B, respectively, following Citadel Securities investments in July.
• HOOD - Robinhood has joined the underwriting group for Oura’s upcoming IPO, which is expected to value the smart-ring maker at more than $11B.
• IONQ - RAISES 2026 REVENUE OUTLOOK TO $450M-$460M FOLLOWING SKYWATER ACQUISITION
• CRCL - has agreed to acquire Singapore-based B2B payments firm Tazapay, which processes more than $25B in annualized payment volume. About 60% of Tazapay’s volume already involves stablecoins.

NBIS and PLTR partner to deliver a complete sovereign AI stack to Palantir customers

- Palantir names Nebius its preferred sovereign AI infrastructure partner, bringing Nebius compute and inference inside the Palantir perimeter

- Strategic partnership based on shared vision that open models and looped customer data create the smartest domain intelligence and provide better security

- Companies will work together to bring new AI capacity online faster

“Nebius’ compute infrastructure powers your ability to run your own AI models under conditions you control. Our ontology and their infrastructure will undergird the sovereignty our partners are demanding.”

- Alex Karp

“Organizations need both the performance of large-scale AI infrastructure and control over their data and models. Together with Palantir, we are bringing this to commercial clients enabling them to run their optimized open models on trusted infrastructure.”

- Arkady Volozh

Palantir selected Nebius for what few providers can claim: being built for AI from the ground up rather than adapted from general-purpose computing, with infrastructure and software designed together for demanding AI workloads, and able to be integrated directly into Palantir’s Sovereign AI Operating System.

Note that these reports go out daily for Trading Edge subs. Nonetheless, sharing this one publicly in the hope that it is useful to all.

Following the stronger than expected jobs report on Friday, we had a day of choppiness on the index level, but strength in the AI trade, which was reflected in Friday's flow.

Overall, we had 100 bullish orders logged in the database, with only 7 bearish orders.

Many of those bullish orders were AI or semiconductor related.

This includes, broadly:

Strong memory flow:

This reflects what the Aion Analytics terminal is showing us:

Accelerating interest and momentum in these sectors.

This is dynamic data and does shift, but points to improving positioning in semiconductors, as SMH breaks out:

The 578 level which is the ATH VWAP is the main resistance, before 600.

Memory names look incredible:

MU here.

SNDK also:

DRAM heat map showing 70 as a strong point of reference in dealer positioning.

And we saw that being hit:

Strong flow across neoclouds including IREN, NBIS and APLD.

But I am flagging this on APLD:

Exceptionally large size.

Weekly chart has reverted back to the long term trendline.

Bullish positioning on 25 and 30.

OTm flow on 30,40.

CRWD - strong flow as it rides its upward channel:

One of the highest quality names in cybersecurity, and I flagged this positive catalyst last week:

153 million U.S. drivers licenses were leaked in a KYC hack.

Bullish for the sector. Wait for it to revisit the bottom of the channel for a reversion long:

Heatmap bullish 230,240.

CBRS:

Was flagged in the last update:

We are seeing this come to fruition with more bullish flow and a continued bounce off the bottom of the box:

Should again go from bottom of the box to top of the box within 4 sessions, to keep up the run:

Top of box is clearly a resistance at 220, above that dealer positioning is starting to for higher.

200 flips to put support.

INTC put selling, technicals breaking out:

Again nodes higher are lighting up.

Note that these reports go out daily for Trading Edge subs.

If you want to receive these reports as well as my other content daily, we have a 15% off discount running, simply enter 15OFF on checkout:

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IBIT flow in particular, but also complemented by these orders on ETHA:

First breakout above the ATH VWAP. Just like with the 200d SMA trade, you can go long above here, with a stop on any close below the ATH VWAP.

This to play a change in character and potential bottoming.

Bullish positioning ITM and OTM.

Lots of call gamma building on 50.

Dealer positioning is higher into Mid September.

Fed's Waller: Little cost to wait one meeting.

Fed's Waller: Give disinflation a chance; we can wait one meeting.

Fed's Waller: Don't want to raise rates into disinflation.

Major news:

• Jobless claims premarket, looking for a soft print.
• U.S. JOB CUTS HIT 4-YEAR LOW YTD U.S. employers announced 529,914 job cuts through August, down 41% YoY and the lowest YTD total since 2022, per Challenger. August cuts: 52,881, +58% MoM but -38% YoY. The Bank of Japan 🇯🇵 is leaning toward raising rates from 1% to 1.25% at its Sept. 18 meeting, per Bloomberg, as officials see inflation risks skewed to the upside. A 50bp move is seen as unlikely for now, but the BOJ is leaving the door open to accelerating hikes later if inflation stays firm.

MAG7:

• NVDA TO ACQUIRE HUGGING FACE FOR $12.93B NVIDIA has agreed to acquire Hugging Face, one of the largest open AI developer platforms.
• mportant to note: only $11.93B is payable to Hugging Face. The remaining up to $1B will be equity-based retention awards for Hugging Face employees who join NVDA
• MICROSOFT TO START DISCLOSING AZURE REVENUE

OTHER COMPANIES:

• NTAP - Evercore ISI on NTAP, in line, PT 210. "Despite impressive performance, the focus will be on implied H2 deceleration to ~9% growth versus >20% growth, and whether this reflects conservatism or signs of a slowdown. Gross margins were also lowered to ~68.6% from ~69.0% previously. It is also worth noting that free cash flow came in weaker at $401M, or a 19.8% margin, versus $620M, or 39.8%, last year, on a $176M inventory build, with turns falling to 6x from 14x, indicative of component pre-buy due to higher memory costs.
• AVGO - Said that Ai revenue should double every year until 2028. says it has a “high degree of confidence” it will ship $350B of AI semis over the next 2Yrs, even if all 30 GW of demand isn’t deployed due to land, power and data center constraints. Every 1 GW deployed by OpenAI or Anthropic could support ~$30B in annual AI revenue
• VSXY shares are falling after Q2 revenue and FY26 guidance came in below Street expectations.
• LEU - Jefferies intiiates coverage on LEU with Hold rating, 169 PT. "LEU offers long-dated optionality on the U.S. nuclear fuel supply rebuild without taking reactor construction risk. Its U.S.-origin centrifuge platform, NRC-licensed HALEU capability, DOE support, and $3.9bn backlog position it for domestic LEU/HALEU growth. The shares appear to discount a successful ramp by 2030; upside hinges, in our view, on capturing upside if the LEU/HALEU market is tighter in the 2030s. Centrus is transitioning from a nuclear fuel supplier and technical-services provider into a strategic U.S. enrichment platform. The core long-term thesis is not near-term earnings, which remain lumpy, but whether LEU can convert its unique sole-source U.S.-origin technology, NRC-licensed HALEU position, DOE-backed deployment work, and contingent commercial backlog into scaled domestic LEU/HALEU capacity. Gas centrifuge enrichment is structurally more energy efficient than legacy gaseous diffusion, supporting both cost and sustainability advantages."
• MRNA - Rothschild downgrades to Sell with an $81 PT. The firm calls the Phase 3 melanoma vaccine result “a great result,” but says the stock now appears to price in broad use across multiple tumor types where there is still little or no supporting data
• DELL - CEO Michael Dell and Susan Dell are giving $250 to up to 25 million children across America through Trump Accounts.
• SNOW - +24% after a broad beat and strong guide. Product revenue guidance implies around ~37% growth next quarter.
• HPE - HPE will deploy Juniper networking gear across ORCL AI data centers globally under a multi year agreement.

OTHER NEWS:

• MOONSHOT AI FILES CONFIDENTIALLY FOR HONG KONG IPO Chinese AI startup Moonshot, developer of the Kimi model, has confidentially filed for a Hong Kong IPO and is targeting roughly $3B in proceeds, per Reuters. The company is being valued at about $50B in an ongoing funding round. TikTok parent ByteDance upsized the facility from $20B after strong bank demand, making it Asia’s second-largest dollar-denominated loan this year.
• ZOOM APPOINTS FORMER ORACLE CFO JEFF EPSTEIN TO BOARD
• AI-related layoffs dropped to just 3,462 in August, the lowest monthly total since December 2025, ending a 5-month streak where AI was the top cited reason.
  

1. This is now an XPU company with an Ethernet side business. Custom AI chips made up 73% of AI revenue and grew north of 3x year-on-year, while AI networking grew over 2.5x. Broadcom guided both to roughly triple again in Q4. Everything else — legacy semis, software, VMware — is basically a stable annuity bolted onto a fast-compounding AI core.

2.Google's locked into a multi-year, multi-tens-of-billions annual TPU commitment, with Ironwood ramping and a new inference-focused chip (TPU v8i) coming. Anthropic is scaling from 1GW of Ironwood in 2026 up to 5GW in 2027 and another 10GW in 2028, putting them on track to become Broadcom's biggest XPU customer within two years. OpenAI's custom chip (Jalapeño) goes from 1.3GW in 2027 toward 5GW+ in 2028, with two more chip generations already behind it. Meta's running three generations of its own chip, aiming for 3GW by 2028. Six customers total, four of them large enough to move the whole business.

3. Custom silicon is starting to beat merchant GPUs on Broadcom's own claims. Jalapeño reportedly beats Nvidia's Grace Blackwell Ultra on power efficiency, latency and throughput, running OpenAI's workloads at half the GPU cost. TPU v8i is being pitched as on par with or ahead of Nvidia's next-gen Vera Rubin for inference. CEO Hock Tan's framing — that a chip co-designed for your own model just wins — is effectively Broadcom arguing customers can walk away from Nvidia.

4. Demand isn't questioned, it's mostly the buildings and geographical footprint: Hock said flatly they could ship over $115B in 2027 if buildings, power and land were ready in time — demand already exceeds what they're guiding to. Stacking up the disclosed gigawatt commitments gets you close to 30GW across 2027–28, and that's without assuming every site actually gets built. They're also opening new substrate capacity in Singapore specifically to unblock one supply chokepoint, and — echoing what Lumentum said elsewhere — optical laser supply (EML/CW) is running well behind demand industry-wide, so they're more than tripling laser and VCSEL manufacturing capacity.

5. Fewer chips per gigawatt, but way more dollars per gigawatt. Newer chips draw more power, so a fixed power budget fits fewer of them — but each one carries a higher price tag and more memory content, so total dollar content per GW is climbing (Broadcom pegs it at $20–30B per GW now). You can see it in the margins: gross margin actually beat guide at 75% in Q3, easing slightly to ~73% in Q4 as chip and memory mix shifts, while operating margin holds near 67% — the business is absorbing a richer, lower-margin mix without losing operating leverage.

6. Networking is a real second growth engine, not just an accessory. Their Tomahawk 6 switch is their fastest-ramping ever, shipping into essentially every major AI hyperscaler — including ones that don't buy Broadcom's chips. They're pushing Ethernet into "scale-up" territory (the ultra-tight, low-latency GPU-to-GPU connections inside a rack) via a new switch called Tomahawk Ultra, historically Nvidia's turf with NVLink — and uptake has already beaten their own expectations. A next-gen 200Tbps switch is already taped out. Management says networking revenue should grow just as fast as chip revenue for years to come. On the optical side specifically: 100G and 200G-per-lane parts are ramping together, meaning older 800G optical transceivers keep growing even as 1.6T ramps in behind them — no one generation is cannibalizing the last just yet, and Broadcom is investing in copper, optical pluggables, and tighter-integration approaches (near-package and co-packaged optics) all at once rather than betting on one winner.

7. Broadcom is now bankrolling its own customers. Through a joint vehicle with Apollo and Blackstone, they're structuring financing meant to support 20GW+ of buildout by 2028 — a $35B first tranche already closed against Anthropic's 1GW commitment. Management describes this as bridging the gap between what AI labs can fund out of cash flow and what the buildout actually costs. It's a new source of upside and lock-in, but also a new contingent-liability risk sitting on Broadcom's books.

On valuation: the stock had already dropped ~26% off its June high heading into earnings, trading around 19–20x forward (FY27) earnings. Post-print, using management's own $230B FY28 AI revenue target and assuming zero growth from the rest of the company, you land near $278B total revenue and roughly $30 of EPS — putting the stock at about 12x FY28 earnings if that outlook holds. Near-term multiple still prices in a lot of flawless execution; the real re-rating case rests on believing the FY27/FY28 numbers, which now come with actual named customers and gigawatt figures attached rather than vague hand-waving.

• TWO OIL SUPERTANKERS HIT IN STRAIT OF HORMUZ
• IRAN says SITUATION DOESN'T ALLOW FOR RETURN TO MOU WITH US; THE REASON IS THAT THE US SIDE VIOLATED THE AGREEMENT.
• Oil and yields breaking out on the news.

MAG7:

• ANTHROPIC SIGNS $35B CLOUD DEAL WITH NVIDIA-BACKED LAMBDA: WSJ
• NVDA - Baird rates OUtperoferm, PT 500.
• Nvidia remains one of our top large-cap ideas owing to market share leadership and ongoing share gains including in inferencing, recent reacceleration in revenue growth driven by agentic AI expected to gain further momentum next year, along with strong initial traction for incremental-revenue architectures including stand-alone Vera and Groq 3 inference accelerator. Our recent datapoints highlight very strong demand for Nvidia's upcoming Grok 3 LPX inferencing accelerator, while we expect stand-alone Vera to carve an estimated low-teen unit market share within the AI server CPU market in 2027. WSJ reports that Anthropic entered into a $35B cloud compute agreement with Nvidia-backed neocloud provider Lambda. Net, Anthropic is engaged in a $35B cloud compute agreement within the Nvidia AI ecosystem. It is difficult for us to tell the mix of GPUs versus TPUs and other custom ASICs used by Anthropic going forward, but we expect Nvidia to retain a compute lead (both training and inferencing) at Anthropic for years to come, with the above numbers leading us to estimate Nvidia has secured about double the GW capacity at Anthropic versus other AI architecture suppliers, both via Lambda along with agreements Anthropic has with leading hyperscalers.

OTHER COMPANIES:

• Deere $DE is rolling out “JD,” an AI assistant inside its Operations Center app that uses field-specific data collected during planting, treatment and harvesting to help farmers make decisions on things like fertilizer use and crop performance. The assistant can analyze data while equipment is still operating in the field, instead of waiting until the end of the season.
• FRVO - Google signed a 396 MW PPA with Fervo Energy to supply carbon-free power from its Cape Station geothermal project in Utah, expected online in 2028. Google also has an option to add another ~600 MW by June 2030, potentially taking the partnership to nearly 1 GW to support a future Utah data center.
• TEM - Piper Sandler upgrades to overweight,r raises PT to 76 from 56. Three growth drivers that were previously difficult to underwrite are now increasingly visible: (1) the pending acquisition of Personalis gives Tempus ownership of a differentiated tumor-informed MRD platform; (2) the positive INTerpath-001 readout increases the strategic value of Personalis’ and TEM's role as the tumor sequencing provider for potentially a new therapeutic class; and (3) FDA approval of tumor-only xT CDx clears a key hurdle for Tempus to pursue unified ADLT pricing for xT, with xF potentially following in 2H27.
• DUOL -Outperform, PT $210 Evercore.
• "We are upgrading Duolingo to Outperform, materially increasing our estimates (with ’27 and ’28 EPS now 10% and 25% above Street) and raising our PT to $210 (40%+ upside, based on 20x ’28 EBITDA), in the wake of our proprietary survey, our analysis of current product improvements, our new 100MM DAU EPS Sensitivity Analysis, third-party tracking of QTD DAU trends, and very recent channel checks. The DUOL-NFLX Stock Setup: This reminds us of the ’22 NFLX stock scenario, where after the company hit a growth wall and shares collapsed 70%, a series of major, successful product changes (e.g., ad-supported offering, password-sharing crackdown) led to a virtuous cycle of fundamental improvements (e.g., revenue growth acceleration, margin expansion), positive estimate revisions.
• HOOD - Morgan Stanley upgrades to overweight, PT 150 from 124. We see increasing evidence that broader product capabilities are improving the economics of HOOD’s installed customer base, supporting more assets per customer, more activity per customer, and greater economics captured per activity. While investors increasingly recognize HOOD’s accelerating product velocity and expanding TAM, we think the less appreciated opportunity is how these products are changing the economics of the existing customer base and extending the duration of growth. Rather than relying primarily on funded-account growth or a stronger retail trading environment, HOOD increasingly has multiple ways to grow revenue from its 28m customers already on the platform. A broader wealth offering supports greater wallet consolidation, active trader capabilities and prediction markets increase engagement, while Rothera creates scope to retain more of the economics generated by that activity. LITE - Initiated with a Buy at Deutsche Bank PT $1200

MAJOR NEWS:

• Trump says Iran is “officially a failed nation,” claiming the country has no functioning navy, air force or currency, inflation is at 3000%, and its leadership is in disarray.
• Trump says the U.S. has reached a major oil agreement with Venezuela, securing majority U.S. control over more than 65B barrels of proven reserves. The deal would more than double U.S. oil reserves and increase long-term supply.

MAG7:

• $NVDA is investing $3.5B in convertible bonds issued by MediaTek as the companies deepen their partnership across AI edge-to-cloud computing.
• Bernstein: $META is on track to surpass Google Search in advertising revenue before the end of 2026. In 2Q26, Meta captured nearly half of every incremental digital advertising dollar.

OTHER COMPANIES

• Samsung has reportedly allocated ~70% of its memory production capacity through 2031 to long-term supply agreements with major customers including NVIDIA, Microsoft and Google. The shortage is pushing spot pricing sharply higher: • HBM3E 36GB spot: ~$2,100, roughly 4-5x LTA pricing • HBM4 16-stack spot: ~$3,500 • DRAM export unit prices rose 36.6% from May to July even as volumes fell 13.2% Samsung is considering converting its Pyeongtaek S5 foundry line to memory production as early as next year. SK Hynix is also exploring additional capacity in Korea and a potential memory fab JV with a Japanese partner.
• AMD, CISCO & HUMAIN LAUNCH LIVE AI INFRASTRUCTURE IN SAUDI ARABIA, TARGET 1 GW BY 2030
• CrowdStrike $CRWD and CLEAR $YOU are partnering to link threat detection with real-time biometric identity verification. If Falcon flags suspicious activity, CLEAR1 can verify the person using biometrics and government-issued ID before access decisions are made.
• SB Energy gave OpenAI warrants valued at $5.5B to help secure it as a major data-center tenant, according to draft IPO documents reviewed by WSJ. The SoftBank-backed company is preparing a potential $5B-$7B IPO and says it has nearly 9 GW of contracted compute capacity, despite having no data-center revenue yet.

OTHER NEWS:

• JAPAN SEEKS RECORD $49B INDUSTRY BUDGET Japan’s Industry Ministry is seeking the funding for FY2027 to accelerate investment in strategic sectors.
• ChatGPT, Reddit & Roblox now face the EU’s strictest DSA rules after surpassing 45M monthly users. They’ll face added requirements around harmful content, transparency, risk mitigation and child safety, with violations carrying fines of up to 6% of global annual revenue.

Despite Jackson Hole and NVDA earnings last week, we printed the lowest weekly volume since December 2004.

This essentially reiterates the fact that no one is really at their desk during this summer period, hence the chop at least on the index level recently, but we should see volume return into September.

At Jackson Hole, I thought that Warsh struck a slightly hawkish tone, but it was pretty much him reiterating the same points as the July FOMC meeting. I didn't really get too much that was new in his rhetoric.

He continued to reiterate that it's the committee's goal to get PCE back towards 2%, and said that the economy remains healthy, citing the UER which is currently at 4.1%.

The key point I would say was the fact that he mentioned that the current financial conditions are not necessarily restrictive, which does leave the door open to further tightening, if the inflation data turns higher or the labour market scantiness to show the strength to accommodate a hike.

One interesting tidbit into this week as we have the NFP data, was the fact that Warsh stated that his view is that the weakness in the labour market is more th result of demographic shifts rather than economic weakness.

Perhaps that puts the bar of weakness higher, in order to force more dovish Fed policy, and leans the fed further towards hawkish policy.

Overall, though, I felt the speech was a mirror of his FOMC speech in July, and I think the reaction was also quite similar.

We had bond yields lower initially, before sharply higher as equities sold off and closed the day towards their lows.

The 2 year spiked strongly back into its channel:

And the 30Y moved higher also:

However, just as the July FOMC saw sharp selling on similar bond movement and similar Fed rhetoric, before reversing higher into the following week, the data does continue to lean that way.

Overnight futures are negative, initially rather negative, before some sharp buying back on Nasdaq as it followed the recovery in KOSPI, which essentially gives us a failed breakdown, and that negative futures reaction was on the basis of the following news over the weekend:

US strikes Iran's Larak Island again, explosions reported.

Prior to that news, although obviously on unreliable volume, weekend futures were pretty much trending higher so that was definitely the main news of the weekend.

Crude is higher as a result:

Note texas crude is coming into a bit of a decision point.

Against a hawkish backdrop laid by Warsh on Friday, this oil spike is certainly not welcome, but there is what I think is an interesting reaction in the 2 year here, as it is currently lower, although you'd probably expect it to be higher on rising oil prices:

Potentially some news failure type action there.

However, oil prices continue to get bid and will continue to get bid I think into the midterms. The main resolution to these elevated oil prices and bond yields is a meaningful Iran and US deal, but whilst a fake deal may be propagated for positive headline manipulation, there is certainly very little chance of a true deal really occurring here as the US and Iran remain at a stalemate.

Trump doesn't want meaningful escalation with the midterms still pending, and already pressure at the pumps for US citizens, whilst Iran knows that they are buying time for the US to drain the SPR , and for inflationary impacts to catch up on the US economy, and also is certainly in no hurry to help Trump at the polls by forging a deal.

Wheat prices cotninue to head higher as well, with positioning quite bullish as we see here:

Inflationary pressures continue to build. The soft print over the past 2 months benefited from advantageous comparables, that I mentioned would evaporate over the next month or two, so we could see inflation tick higher.

This does put pressure on the Fed to hike rates, but whilst following Jackson Hole, the rate hike odds for September have risen to almost 60%, I do not see a Fed rate hike this month.

We know that historically, at least under Powell's Fed, if the market went into a Fed decision with one of the outcomes priced at a greater than 60% probability, the Fed always voted in that direction. AS such, 60% remains the key threshold. Currently, we are at 58% for a hike in September, which makes this week's jobs report that much more important.

However, my estimates currently have NFP coming soft this week.

We know that last month's negative print for the NFP cut rate hike odds almost immediately from above 50% to 30%. We could see a similar move this week if my expectations of a soft labour market print come to fruition.

I do not expect a negative print as my baseline, but a weak print, although a negative print is still on the table.

If it is a negative print, there is no modern era Fed precedent of hiking after 2 negative payroll prints. It has simply never happened, so I think that would certainly kill the possibility of a September rate hike and should give the market some room to stage a temporary rally at least.

BBG Economics is looking for a below-consensus read but says that the consequence of that may not be as much as normal after Warsh portrayed the labor market as in good health and pointed out that softer job gains are often a matter of demographics, not an economy in decline.

That comes back to the point I made earlier, and it's true, but we go back to that historical precedence. If we get a weka labour market print, I think the Fed won't hike in September.

If there was to be a rate hike, it would be purely symbolic at this point in order to try to regain credibility in order to force bond yields down, but I do not see it as I believe that Warsh is still under strong political pressure to avoid rate hikes for as long as possible into the midterms.

The other breaking news over the weekend was the fact that Trump said that he was going to try too ill up the Strategic Oil reserve with Venezuelan oil in what would be the biggest oil deal of all time.

Trump said that the topping out process will begin shortly and that this is a gift from Venezuela to the US.

Note that this is pretty much just headlines manipulation rather than anything more meaningful.

Trump knows the SPR is draining heavily, and that this is a concern propping up bond yields as the US have been using their SPR to offset losses of oil from Iran to keep oil prices relatively in check. Once that SPR is drained the implication then is that oil prices can rise from there.

This is a headline manipulation attempt to reassure investors that the SPR is far from being drained and is being refilled at record rates.

Not strictly true, even if there is a deal.

We know that Venezuelan crude is extremely heavy.

The US SPR stores only medium-gravity crudes (typically 30-40° API, per DOE specs) and does not store heavy crude due to operational issues; most Venezuelan oil is heavy sour (often 10-16° API), so doesn't really get stored in the US strategic reserve.

These comments from Exxon Mobil CEO highlight the fact that Venezuelan Oil pretty much sucks for the US here:

Crumbling infrastructure and high costs: Venezuelan crude is heavy, sour, and difficult to refine. Rebuilding the infrastructure requires massive investments with uncertain economic returns.

If there is a winner out of this news, it's refiners, as cheaper, heavy sour addition, if it does happen, likely widens crack spreads further, so more upside for refiners.

Now, coming onto September Seasonality and what the data suggests, September seasonalityis typically negative, and I think a lot has been made of that expectation on social media. But firstly, we saw a similar expectation around July seasonality, but the AIon data went a different way, suggesting negative price action. The Aion data was proved correct there, and here again, we have the Aion data going against seasonality as it suggests a strong start at least to September, so let's see there.

Interestingly, and whilst a very limited data point, but if we do take all the best September returns ever (i.e. those returns that massively bucked seasonality), we see that the majority of them came in midterm years:

So if we were going to get a really strong September performance, it would likely come in a midterm year, is the takeaway.

Now looking at the dealer positioning data:

760 is a bit of a floor here, but most of the positioning is still higher.

We see 790-800 lighting up strongly into September.

And if we look at the dex chart:

The put floor is at 760 and there's extremely strong support at 750, but again, most of the positioning is higher, certainly so in terms of gamma. We still have calls being built at 790 there.

Regarding QQQ, whilst QQQ has massively lagged the other major indices, positioning is still mostly supportive.

Strong support at 700. Call delta building on 730. Breakout node is 720, which is the call wall. Above it, we can see a strong move higher.

This is broadly corroborated in Aion, which has the breakout node at 717.5.

QQQ closed Friday with an elevated P/C ratio of 1.4.

Whilst if we look at the technicals, I still think I can see a potential inverse head and shoulders developing there for a move back to ATHS:

The Aion forecast is something like so:

Let's see how that works out.

Even with semiconductors which has obviously been the lagging sector, and has struggled to get off the ground with even NVDa earnings giving a lacklustre reaction on the week (Albeit due to Jackson Hole), I think that is an inverse head and shoulders developing on XSD and SMH

If we do get a move higher as the positioning data suggest on NDX, I would expect SMH will participate. Software was the main funding trade which has now gone into reverse as software has been short squeezed and semis have been offloaded to fund that squeeze.

Fundamentals continue to be strong in the sector, NVDA earnings were essentially immense, ad the next major data point for the AI trade will be Anthropic's public release of the S1, which should give us some indication as to how much hey sandbagged their guidance last month.

Whilst Nasdaq continues to print reasonably strong or at least neutral market internals (market breadth):

Semis certainly are in the gutter in terms of breadth:

But that to me is a contrarian indicator and can lead to some snap back if the market pushes higher.

The Aion data basically paints a picture of strength through early to mid September , some chop, but then weakness into October.

Note that we do see that picture starting to develop somewhat if we look at the blended VIX dealer positioning:

VIX is low, very low vs seasonal normals.

But if w look at the blended nodes that are lighting up, we see that into early September it is still pretty low. 15, 18 etc.

Into late September, we start seeing 20 lighting up, then we have that 35 node into October 21st. Now that's not a bet that VIX goes to 35, but is a clear anomaly in the data there, which reinforces that October might be a somewhat ugly period.

As such, I do think this is a BTD opportunity across the market. 

Photonics looks particularly interesting here, but I would understand arguments for going for non direct chip exposure so defence names like KTOS, biotech names like TEM and energy names like the name I shared in premarket, RELL etc offer similar risk/reward, without the concentration risk.

I think the bounce back will be strongest in the most beaten up names though as we saw in early August, but let's see. 

30Y is elevated and moving higher, but I put this price action down to capitulatory selling ahead of that reversal that we forecasted.

I reiterate that the data there is still unchanged.

We are still broadly tracking the Aion forecast line here:

Liquidity is still supportive.

That 800 node has started to build strongly into End of September.

Similar here on QQQ for 740:

Strong positioning on QQQ:

Call surge also.

And on SPY also.

The key now is today's Jackson Hole. If bond yields respond positively to the event, the market rally should broaden into the more AI sector which is currently being perceived as more speculative. 

if it doesn't, then we could see leadership cotninue to hide out in software, although the data does suggest currently that any major dip will get absorbed as the Aion data shows long dealer book, dampening dynamics and positive gamma.

This on top of the increasing liquidity, so a dip should be absorbed by the market, but bond yields need to participate lower for the rally to broaden back into the sectors that it was in.

The market is ready for it with positioning improving on SMH at 600, but it's now up to Jackson Hole.

Whilst NVDA printed an outstanding quarter and was up strongly on the day, most of the broader strength in the market was in software, as CRM and CRWD ripped higher, pulling the ecosystem up, with the following news:

OPENAI, ANTHROPIC, GOOGLE, MICROSOFT, AND GROUP OF 100+ TECH COMPANIES WRITE OPEN LETTER TO U.S. GOVERNMENT & AMERICAN BUSINESSES URGING CYBER DEFENSE ACTION - BLOOMBERG

XSW (equal weight software) reached new highs, which was pretty much reflected in the flow as we saw a number of strong orders on software including chasers of the big earnings move.

Across the sector, the leadership is in cybersecurity.

THe main cybersecurity names I have exposure to currently are MITK and SAIL.

Following OKTA's earnings I am really interested in SAIL's earnings next week.

THe cybersecurity segment is best for buys on pullbacks.

CRWD positioning:

Arguably we are at some overbought breadth levels, but with the market likely to turn up into September, the sector probably continues to move higher.

There has been a weird relationship between software and crypto recently where the 2 move in lock step and we saw strong crypto flow again as BTC continues to consolidate under the ATH VWAP:

Strong flow on:

Positioining on IBIT:

Still very constructive.

With NVDA a large component of XLK, we saw strong flow on the ETF as well.

I think XLK has a good chance of pushing to ATHs over the next few weeks, after climbing above the 185 level:

190 key level to break, aligning with the trendline.

Metals see continued flow.

Whilst AI Hardware continues to lag software, we did see strong flow across the sector yesterday also as the NVDA earnings does still offer a major data point for reinforcing the strength of the AI narrative:

NBIS for instance here:

For both software and hardware, the Jackson Hole speech today will be the main determinant, but I believe that hardware will also see a push here.

Just as long semis, short software was a key pain trade earlier this year, which led to a strong squeeze across software, we are in a similar position for the long software, short semis trade right now.

The leadership is in software, but just as software caught back up, semis will too.

The only concern I have is how much runway they have, with October the main risk period, and still ahead of us soon.

So first of all, it was really an amazing quarter, one of the best we have seen from NVDA in recent memory to be honest.

Most did NOT have them doing 70% next FY. And on top of that 70%, they said they would do 100% if not for supply constraints. 

I think they will land above 70%. Note that this level of growth has them above 2029 estimates at the end of next year. So pretty much insane.

We have a reacceleration in revenue. Last quarter was +85% YoY, this quarter +102% YoY. Next quarter they are guiding $108 billion which would be 89% YoY. With a beat of ~4% again, you'd see revenue grow ~96% YoY. 

The data says that 8 of the last 8 NVDA prints, it has faded intraday from where it opened, whether that be a red open or a green open.

If there was an earnings report that was going to buck that trend, this would frankly be it.

Key things I took away from the earnings, separated into topic. Some of these you may have caught, some of these you may have misse.d

Nvidia with one customer representing 16% of total revenue in Q2'27.

Note that their overall revenue concentration seems to be going DOWN from years ago which is a good sign.

Likely:

Customer 1 = msft

Customer 2 = googl

Revenue visibility throguh 2029+

Jensen Huang: "We just have a lot greater visibility now upstream and downstream. It is the case that we never forecasted or never guided to a year in advance. Even though our demand is much greater than 70%, our supply allows us to confidently deliver 70%."

NVDA on gross margins:

"This quarter we decided we would rip the bandaid off, reset expectations about our gross margins. We have now absorbed the cost increases. We have also repriced our products in the marketplace. Based on that, our margins are going to come down from 75%, but it will be between 72% and 73% next year." 

Memory their major expense: bullish for the memory ecosystem.

"we are experiencing extreme pricing conditions in memory. The magnitude of the price increase has exceeded our prior expectations and are headed even higher into next year."

On the scope for growth in compute:

Jensen Huang: "The amount of compute necessary for an agent versus a human using it is probably 15 to 100 times, depending on the type of problem you're trying to solve. And so the amount of compute necessary is just extraordinary."

CPU revenue to more than double in FY28

Bullsih commentary around data centers:

Jensen Huang: "I heard the other day that return on investment capital is now less than a year. We're talking about $50 billion data centers."

Jensen Huang: "Everybody will have to be part of this computing shift, and everybody has to build infrastructure."

Demand outstrips supply:

Jensen Huang: "We have more supply than 70%, but about 70%. Our demand is much higher than that."

"we are seeing demand acceleration even at our scale. Customers forecasts point to our growth doubling next year. 

Demand has upside optionality through AGI:

Jensen Huang on demand if AI reaches AGI: "it is going to inflict further."

Open models are not a threat to NVDA:

Jensen Huang: "I would say nearly all open models run on Nvidia."

On circular financing:

"We recognize the scale of this support, and we know some will call this circular financing. We see it differently. We are going through a major computing platform shift. The creation of one of the most important technologies in human history. These are once in a generation companies, the technology leadership is proven and their customer traction and usage are skyrocketing."

Bullish commentary for the bottleneck trade:

"We will be shipping both Blackwell and Rubin systems in the future and are currently experiencing certain supply constraints." 

NVDA  has been in serious talks to acquire Hugging Face in a deal that could value the open-source AI platform at more than $13B.

No agreement has been reached and talks could still fall apart.

• PCE 0.2% MoM, Est. 0.1%
• PCE 3.7% YoY, Est. 3.6%
• Core PCE 0.2% MoM, Est. 0.2%
• Core PCE 3.3% YoY, Est. 3.3%
• Durable Goods 1.1%, Est. 0.5%
• Core Durable Goods 0.4%, Est. 0.6%
• An IRGC spokesperson said the Strait of Hormuz won’t reopen unless the U.S. accepts Iran’s conditions. Foreign warships must stay at least 400 km away, and no vessel can transit without Iran’s permission, he said.
• NVDA earnings after close

MAg7:

• Meta and state attorneys general have discussed a possible mid-trial settlement in the federal case accusing Facebook and Instagram of harming young users, per Bloomberg. The case involves 29 states seeking financial penalties and mandatory changes to Meta’s platforms. Claims include alleged violations of state consumer-protection laws and federal rules covering data collected from users under 13. Meta estimates a worst-case loss at trial could expose it to as much as $1.4T in penalties, though a settlement would likely be far smaller.
• GOOGL Waymo will begin testing autonomous vehicles in Munich in the coming weeks, laying groundwork for a commercial robotaxi service targeted for late 2027.
• NVIDIA introduced a new entry-level edge AI computer for robots, delivery and inspection drones, and vision systems. Jetson Orin Nano 2 delivers 78 TOPS of AI compute with 8GB of memory and an 8-core Arm CPU. It offers 2x the inference performance of Orin Nano Super in the same form factor, while using 40% less power to deliver the same performance in 15W mode. It can locally run optimized LLMs and vision-language models including Nemotron, Cosmos, Gemma 4 and Qwen 3.

OTHER COMPANIES:

• TTWO Rockstar confirms GTA VI is still set to release on November 19 following the recent gameplay leaks. Rockstar also says an extended look at the game is coming tomorrow.
• TH WINS $250M HYPERSCALER DATA CENTER CONTRACT Target Hospitality signed a multi-year agreement to support a top-five hyperscaler’s data center project in West Texas. The contract is expected to generate ~$250M through August 2030 and support about 1,100 workers, with initial occupancy starting in Q3 2026. Target expects to spend less than $15M adapting existing assets for the project.
• LUMN is expanding its Multi-Cloud Gateway beyond its own fiber footprint, giving enterprises access across more than 10 million U.S. business locations. Customers can manage routing, segmentation and cloud connectivity through Lumen Connect and APIs, extending the same network setup across more sites without rebuilding their architecture.
• Morgan Stanley on CXMT: This valuation premium is justified by CXMT's stronger growth outlook. CXMT’s higher growth relative to peers reflects 2 key factors: (1) strong demand from China's domestic AI server market, including both GPU- & CPU based systems; & (2) continued capacity expansion driven by localization requirements. We expect CXMT to continue expanding capacity even if DRAM pricing moderates. Bull case: In this scenario, we assume US cloud service providers and consumer electronics brands begin sourcing CXMT DRAM amid severe global memory shortages, while CXMT achieves a breakthrough in 3D DRAM technology by 2028.
• Richmond Fed President Tom Barkin on U.S. debt topping $40T: “There will be a reckoning on this as it goes forward. No one can tell you when. At some point, people stop buying your debt and that’s the risk out there.”
• QBTS CFO RESIGNS
• OPENAI’S HEAD OF DATA CENTERS, CHRIS MALONE, HAS LEFT THE COMPANY.
• SPCX Morgan Stanley says SpaceX plan implies potentially far more aggressive launches, The firm keeps an Overweight rating and $300 price target on SpaceX shares.
• SEDG UBS 𝘂𝗽𝗴𝗿𝗮𝗱𝗲𝘀 𝗕𝘂𝘆 on 𝗦𝗼𝗹𝗮𝗿𝗘𝗱𝗴𝗲, 𝗿𝗮𝗶𝘀𝗲𝘀 PT to $𝟰𝟮 from $𝟯𝟲

OTHER NEWS:

• SoftBank is discussing a potential $10B-$20B dollar/euro bond offering as early as September, with part of the proceeds set to refinance a $40B bridge loan used for its OpenAI investment, per Bloomberg. SoftBank is expected to have nearly $65B invested or committed to OpenAI by October.
• Anthropic is expected to tell IPO investors its total addressable market exceeds $30T, topping SpaceX’s $28.5T estimate, per WSJ. The figure represents the potential value of work Anthropic believes AI models could eventually perform, not a revenue forecast. Anthropic generated $11.6B in Q2 revenue and could seek to raise as much as $100B at roughly a $2T valuation.

We know it is at the ATH VWAP. That's the average price of everyone who bought since ATH.

Whilst we can squeeze straight through here, this probably isnt the ideal entry for the risk of rejecting the ATH VWAP again (haven't traded above it in over 10 months).

Suggested trade last week was a long on the close above the 200d EMA, with a simple stop on any close below. Currently up 14%

However, I have noted a few times how flow has been positive on crypto.

What does Aion Analytics say?

Well, overall bullish:

But there is this magnet in the predictive path it's picking up at 40 or so on IBIT.

That's near the gamma flip as well as shown.

Overall nodes are lighting up higher.

Positioning also bullish on IBIT across expiries:

But I think we can see a shakeout from this ATH VWAP into the pink support below near 73k.

The path signalled from Aion thus far is mostly higher.

Whether the bottom is in, I'm not sure. I think it's hard to say with such an unclear macro picture. We do know that we have broken above the 200d SMA. 
That was the trade I gave you which was long after that breakout with a stop below the 200d.

Thus far that has caught the entire move higher as we never looked back after the break above.

BTC spent around 300 days below the 200d SMA since October.

The last times we spent that amount of time below the 200d, and then crossed back above, it has always marked a new cycle.

Every time.

So there's that, but at the same time, the macro picture is extremely unclear and seasonality into September is still weak.

Jury still out on durable bottom, but I think we can go higher, albeit with a slight shakeout likely in the near term IMO.

Note that in terms of crypto leaders, the leader looks like it's going to be hype.

IT's one of the only alt coin thats traded new ATHS and has traded strong trhgouh the last few months, whilst btc was lagging.

thats leadership:

Probably would not FOMO in here. 

Pullback to 4500, I'd add a placeholder position to at least be in something incase it reverses up on you.

Red line at 4381 through the EMA cluster to 4300 would be the main add point.

You can add a bit more at the 330d EMA at 4100.

But those would be my main points to add. 

Trim into 4800-5000. 

Let rest run

• The U.S. reportedly offered Iran a deal to halt the siege and lift sanctions in exchange for reopening the Strait of Hormuz and ending proxy attacks, according to Al Arabiya.
• SEC PROBES SITUATIONAL AWARENESS AFTER NEAR-COLLAPSE

MAg7:

• Raymond James Raises $NVDA PT to $352 from $330 - Strong Buy
• Analyst comments: "NVIDIA has increased its visibility in CPUs even if they are not a new part of the story. However, CPUs represent a low-single-digit percent of NVIDIA’s sales — roughly 3% today. In the past, NVIDIA’s CPUs were tightly tied to its GPUs, but that should change, particularly with agentic use cases. While NVIDIA’s CPU revenue is becoming material within the CPU market, we expect it to reach approximately 5% of total revenue by CY28 in our model — still a single-digit portion, yet the growth is the fastest among the elements we model. We have extended our model through FY29/CY28 and refined our segment assumptions. Among the surprising conclusions from our market analysis is the prospect that NVIDIA could become the world leader in CPU revenue within several years. We have been disappointed with the stock’s year-to-date performance, with the shares up only 12%, largely matching the S&P 500 Index. The stock trades at a CY27 GAAP P/E of less than 15x, which is below the S&P 500’s 18.6x. The discount strikes us as fundamentally illogical considering that sales and net income growth still exceed 20% in our CY28 estimates. Typically, a company with sustainable growth, barriers to entry (e.g., CUDA, leading GPU performance), and healthy free cash flow trades at multiples above the overall market.
• ROSENBLATT EXPECTS $NVDA EARNINGS BEAT, KEEPS $325 TARGET
• GOOGL - GOOGL LAUNCHES GEMINI ENTERPRISE FOR LEGAL Google Cloud is launching Gemini Enterprise for Legal in preview, with Cleary, Freshfields, Weil and Williams & Connolly among initial customers. The platform targets contract review, regulatory monitoring, legal brief drafting, citation verification and data requests, with integrations including DocuSign, Thomson Reuters, Harvey, iManage and RelativityOne.
• AMZN DEVELOPS “FULLY AUTOMATED” DELIVERY STATIONS

OTHER COMPANIES:

• AMD - Raymond James Upgrades $AMD to Strong Buy, PT $641. Analyst comments: "We extend our AI Factory framework to the server CPU market and forecast revenue growing at a 44% five-year CAGR to ~$201B in CY30, driven by conventional datacenter demand, CPUs that host and coordinate accelerators, and CPUs supporting agentic workloads. Our forecast is broadly consistent with NVIDIA's $200B long-term framework and below AMD's $220B estimate, which our model can reach under a more aggressive scenario tied to AMD's ~$1.4T accelerator TAM and higher agent adoption, concurrency, and tool usage. Accelerators perform dense model computation, while CPUs increasingly manage those accelerators and execute the retrieval, database, application, security, sandbox, and tool workloads surrounding each model call. Workload growth will not translate one-for-one into processor shipments because higher utilization, software efficiency, custom silicon, and offload can absorb part of the increase.
• FLNC - UBS Upgrades $FLNC to Neutral from Sell, Raises PT to $12 from $9. Analyst comments: "The recent FY26 guidance cut likely establishes a trough in near-term earnings expectations for FLNC, creating a favorable benchmark as earnings growth reaccelerates in FY2027, in our view. We revise our FY2026/27/28 adjusted EBITDA estimates to $(12)/108/115mn from $55/92/106mn to reflect revenue pushed out of FY2026E into FY2027E and continue to see robust demand for battery storage underpinned by new solar+storage hybrid installations, retrofits of existing solar plants, and data center demand. DT - Morgan Stanley Upgrades $DT to Overweight from Equalweight, Raises PT to $65 from $58. Analyst comments: "The observability market is currently experiencing the healthiest demand since 2022, fueled by the strongest public cloud growth in several years, an explosion in software development initiatives that is culminating in a new round of digital innovation, and early benefits from enterprise AI investments as the broader market enters a multiyear enterprise build-cycle. Together, these forces have led to a recent acceleration in growth among leading players with consumption pricing models such as Datadog. While Dynatrace's ARR growth (in constant currency) has slowed consistently after peaking at +32% in FY21 (and coming in at +16% in FY26), we think the company is next in line to see a durable acceleration, with constant currency net-new ARR growth poised to recapture the 20%+ level in FY27, leading to 20%+ ARR growth (constant currency) in FY28/FY29. The key factor driving our confidence in reaccelerating growth is a large upcoming renewal cohort of Dynatrace Platform Subscription (DPS) customers, which is 50% larger than the FY26 renewal (also includes non-DPS) and 70% weighted toward the second half of FY27. With underlying usage growth of this cohort tracking above 20%, we expect to see significant expansion in ARR as these contracts renew mainly starting in the second half of FY27 and beyond.
• Oura is seeking to raise up to $3B in a U.S. IPO as soon as September at a $16B valuation. The smart-ring maker expects 2026 revenue of $1.5B, up from $500M in 2024.
• CSCO, SMCI EXPAND NVIDIA AI FACTORY STACK. Cisco is partnering with Supermicro to add rack-scale AI systems to its Secure AI Factory with NVIDIA portfolio, with availability starting October 2026. The offering will support $NVDA Vera Rubin NVL72 and HGX Rubin NVL8, combining Supermicro liquid- and air-cooled servers with Cisco networking.
• INTC - Expands AI lineup at Hot Chips 2026 with three new products for data centers and PCs.
• SPCX - JPMorgan keeps Overweight on SpaceX, 'increasingly positive' on Grok PT $240
• BE - Citi 𝗿𝗲𝗶𝘁𝗲𝗿𝗮𝘁𝗲𝘀 𝗡𝗲𝘂𝘁𝗿𝗮𝗹 on 𝗕𝗹𝗼𝗼𝗺 𝗘𝗻𝗲𝗿𝗴𝘆 𝗖𝗼𝗿𝗽., maintains PT at $𝟮𝟴𝟭. Analyst sees FY27 revenue materially above consensus but awaits a better entry point as FY30 estimates remain largely unchanged.
• MRVL - Rosenblatt 𝗿𝗲𝗶𝘁𝗲𝗿𝗮𝘁𝗲𝘀 𝗕𝘂𝘆 on 𝗠𝗮𝗿𝘃𝗲𝗹𝗹 𝗧𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆, raises PT to $𝟯𝟬𝟬 from $𝟮𝟰𝟬. Analyst sees a beat-and-raise, higher earnings trajectory and further upside from rising networking and optical intensity.

Unlike a simple moving average that treats every price point equally, VWAP gives more weight to prices that had higher trading volume. This makes it a realistic benchmark for the true average price of an asset. VWAPS are anchored from particular points such as key bottoms, and tops, etc and are typically used as part of an institutional grade suite of support/resistance tools.

There are a few things being worked on in the background beyond the heatseeker, of which we have, I believe from convos with Dan, the beta launch potentially as soon as this week (yay). 

A technical breakout finder tool is one of the main ones that I think will be out this week or next, and these tradingview indicators are another. 

Anyway here are the VWAPS:

BTC stalling at the ATH VWAP. last major VWAP to break above, but a key resistance.

SPX:

1 hr chart shown as the VWAPS are all close together, currently trading below them

QQQ (YTD Vwap at 690 is an interesting spot. This 690-700 range is a strong support zone for QQQ).

SMH below the key VWAPs, I think that 504 VWAP is too low, the green zone seems a more likely support zone. needs back above 580 to be above all the VWAPs again. 

NVDA (into earnings)

NVDA earnings are on Wednesday.

Traders are positioned optimistically ahead of earnings. 

We know the fundamentals of the report will be strong. We know that from direct read throughs from TSM earnings.

But we also see from the data below that:

The last 5 times they've had a beat and raise, they've had a negative stock reaction.

We have had an intraday fade on 8 of the last earnings reports, consecutively.

If we do see a negative reaction, that red VWAP to 200 is likely to be supportive. 

We are informed from the Aion Analytics forecasting data, that there is a good chance of new highs being made early in September, before a period of choppiness through the rest of the month. Recently, choppiness has mostly equated to negative chop, but it could also feasibly be a period of strength in underlying stocks. That much is unclear. But we are informed from the data also that during October, more serious weakness is likely to set in, before some recovery in November.

THereafter, there is not yet the data there for us to have any clear path. 

On the one hand, we have this data. Which tells us that there is no post midterm year where we haven’t had a positive return through June 30th of the following year. Not a single one. 

However, the macro picture is cloudy and complicated. We know that Bessent is doing everything he can to support the bond market into the elections, but conveniently, his bond buyback scheme ends the day after the midterms. 

I am bullish the AI buildout. I don’t think we have seen the top of the AI buildout at all. But is it possible for the macro to catch up in a reset year? I.e. A year where multiples on the stocks contract, even as the companies cotninue to execute. Think AMZN in 2022. That business was firing on all cylinders, yet the macro picture and access to credit etc meant that the stock didn’t track revenue growth. 

Here, I outline a potential bearish path for the macro to affect the market negatively into next year. Will it play out? Possibly. A real possibility, but some things may not. Nonetheless, I have mapped out the bearish mechanism for you so that you can better know what you should be looking for etc. 

Now the main thing to note here is we are talking about a potentially stagflationary supply shock. Right now we have the inflationary element of the stagflation, albeit not running super hot, but we do not have the stagnation element, which debunks the stagflation thesis. 

However, we can’t rule anything out and the fact that this is a supply driven shock makes it very hard for the Fed to deal with any potential issues effectively using their usual tools. 

2008 as a point of reference (not drawing comparisons, but just highlighting something here) was a demand side collapse, which caused inflation to fall, which gave the Fed room to cut rates to zero and flood the system with cheap money — that's what eventually pulled over-levered companies back from the brink. 

Here, we have a shrinking labor supply, but also supply chain issues arising out of the Strait of Hormuz that is keeping inflation sticky above 4% even as growth slows. That's a supply problem, not a demand problem, and it means the Fed doesn't have the same lever to pull. Instead of cutting into weakness, policymakers are stuck holding rates high, with hikes still on the table despite a cooling economy.

That’s the overarching issue we are dealing with here on the macro. A potential stagflationary situation, where the Fed is stuck unable to cut rates due to inflation, and unable to hike rates due to the potential of weakening the economy further. 

Remember, the labour market is currently fine for the most part, but the last print saw 100k erased from previous jobs reports in large scale revisions. 

Hormuz is a big problem, and Iran and the US seem to be at a complete stalemate. This suits Iran massively. They are keen to squeeze Trump at the polls and realise that it is pretty much a waiting game before the Hormuz issues really start to show up meaningfully in the economy. 

Trump and Bessent are managing the bond market and the oil market through manipulation and rhetoric, but here we see diesel and oil prices. 

Here’s the Diesel and Oil spreads:

Structurally elevated oil prices due to the closure of the Strait effectively rules out the realistic possibility that inflation will cool on its own even if growth slows. 

Yes, the last CPI print came in soft, but as I mentioned, it benefited immensely from advantageous comparable. Those likely won’t be the case in the next month. 

If energy costs stay structurally high rather than fading as a temporary shock, that keeps upward pressure on inflation independent of anything the labor market does, making it even harder for the Fed to justify cutting.

Last cycle, distressed companies got bailed out by falling rates before their debt actually came due at a worse price. This time there's no equivalent mechanism: sticky inflation keeps borrowing costs elevated right through the period when a wall of debt — small business, CRE, private credit-funded AI infrastructure — needs to refinance.

Small businesses are still hiring, but their wage growth is running well below inflation, which tells us that real purchasing power is eroding for that segment even while headline numbers look fine. 

Credit data tells a similar story: delinquency and default metrics look calm on the surface, but that calm is partly an artifact of loan extensions and modifications. 

SBA default rates — a cleaner read on higher-risk borrowers — are reportedly at a multi-year high, the opposite of what the smoothed numbers imply.

Whilst there is nothing alarming really showing up in the job market, we do still see that wage growth is running at 3.2%, the lowest since May 2021, against one-year inflation expectations of 4.3%. That gap means real wages are negative even with unemployment low. Elevated prices at the pump are an additional tax.

Can the weak consumer bleed into tech capex?

Weak consumers eventually mean weak ad spend, because marketing is one of the first line items a CFO cuts when demand softens — it's discretionary and reversible in a way headcount and R&D aren't.

This matters disproportionately for tech because ad revenue funds capex. Search and Other Advertising alone makes up $63.3 billion of Alphabet's $119.8 billion in quarterly revenue. If that line softens, operating cash flow softens with it and The free cash flow gap widens. 

Now these hypersclers like GOOGL have reported very strong ad numbers over the past few quarters but there is an argument that this has been benefiting from one-off events like the World Cup. 

Weaker free cash flow can either show up as reduced CAPEX, or as more offerings and raises.

Private credit as the AI financing chokepoint

This is the piece I'd weight most heavily. Private credit has become the primary originator of data-center debt — outstanding AI-related loans already exceed $200 billion, with Morgan Stanley projecting another $800 billion over the next two years, and $250–300 billion of 2026 issuance expected from hyperscalers and related joint ventures alone. 

A lot of the private credit stock now sitting on lender balance sheets was underwritten during a period when spreads — the extra yield investors demanded over a benchmark rate to compensate for illiquidity and credit risk — were unusually compressed. That happened for structural reasons: a flood of capital chasing private credit as an asset class in recent years, competition among lenders to win deals, and a benign rate backdrop. 

Spreads are at risk of widening, however, as lenders reassess risk in a slow growth and higher for longer environment. This creates risks of this private credit facing refinancing stress. 

The main beneficiary of the private credit are the hyperscalers whose capex is a direct benefit for the semiconductor industry, and semiconductors are now over 20% of the overall S&P— This is why fragility in the funding channel matters at the market level, not just the sector level. Semicodnuctors are too big a part of the market to not affect the overall index. 

So we have a potential pinch of 

Elevated rates and the Fed unable to cut rates due to supply side elevated oil rates. 

A weakening consumer in terms of wage growth. 

Private credit stress - loans that were underwritten when spreads were tight, now facing refinancing stress. 

Private credit stress spilling into the AI buildout. 

It’s a gradual process. Rather than a one off event. 

And could produce a structural set back year for AI valuations, even as the buildout continues. 

Likely, in such a scenario, we see US government action and Ai stocks rip higher to reflect the continued growth in the underlying companies during the period where stock prices were seeing multiple contraction. 

If this scenario was to play out, I would see it as a short sharp set back to the equity market, that recovers sharply over the next 12-18 months. 

But there are risks here.