Volatility continues to pick up as the Nasdaq closed at the day’s lows on high volume, with traders digesting Fed comments and getting ready for earnings after the bell. The VIX popped above 20, but the put/call ratio remained relatively low considering the pullback we have seen in the Nasdaq. The path of least resistance remains lower, and today’s reports don’t look likely to provide a much-needed boost to the Nasdaq.
Meta (META) Earnings
Meta reported after the close: revenue of $60.8B (slight beat) but EPS of $6.18, a clear miss versus the ~$7.14–$7.22 consensus range. Q3 revenue guidance came in soft at the midpoint relative to estimates, and the company narrowed/raised the bottom end of its 2026 capex range (still pointing to very heavy spending). The stock was down hard after the bell (reports of 4–8% drops in the initial reaction). This is the classic pattern we’ve seen from several high-expectation names this season: the numbers (or the spend) just aren’t expanding the narrative enough.
The major support zone on Meta was at $550, which broke during after-hours trading. However, we will see if it can recover this low during the cash session tomorrow. If not, expect further downside and a further drag on the Nasdaq.
Meta Post-Earnings Move
Microsoft (MSFT)
Microsoft delivered a clean beat—Azure growth at 43% (vs ~40% expected), overall revenue ~$90B, and solid adjusted EPS. Shares initially rallied in after-hours trading (with various prints showing +2–4% moves early). However, the move has stayed inside the expected range, and the stock is trading below support. It hasn’t produced the kind of decisive, momentum-shifting breakout that would flip the broader Nasdaq technical picture. Capacity constraints and the ongoing heavy capex conversation are still part of the story.
Resistance in Microsoft remains between $400-405, and especially into $420-425. With significant resistance, plus a daily Squeeze and bearish trend, I expect more downside post-earnings. This is combined with the historically bearish post-earnings pattern that has been in place for the last year.
Microsoft (MSFT) Post-Earnings Move
Price Action Confirmation
The Nasdaq closed at the day’s lows. SMH did the same and was down over 4%. That keeps the breakdown intact: lower highs, failed breakouts, loss of momentum, and price still below the 50-day SMA, with the squeeze yet to fire constructively. The short in SMH remains the higher-probability expression of this environment, while semis and related names continue to see heavy selling volume. I personally took profits on my short, as SMH hit my first downside target at $520, but I’m considering adding a secondary short at $450.
Positive Earnings Reactions
The standout constructive reaction today is Lam Research (LRCX). They posted a solid fiscal Q4 beat (adjusted EPS $1.82 vs ~$1.69, revenue $6.72B vs ~$6.66B) and raised guidance meaningfully for the current quarter (EPS ~$2.15 and sales ~$8.1B vs much lower consensus). Shares jumped more than 7% after hours, but they have already given back much of that move. That’s a clean beat-and-raise in semiconductor equipment and worth watching as a potential relative-strength pocket inside an otherwise weak group.
Lam Research – LRCX Post-Earnings Move
Arm reported a double beat, but the stock reaction was muted to negative (initially lower).
Qualcomm was more mixed (revenue at the high end / slight beat, EPS roughly in line) and hasn’t produced a standout positive move.
Nothing else in the Mag 7 or core AI complex delivered a reaction strong enough to challenge the broader “expectations are too high / sell the news” pattern we’ve been tracking.
That means that unfortunately, without multiple strong movers, the path of least resistance remains lower in the Nasdaq.
Final Takeaway
The path of least resistance for the Nasdaq remains lower until we see a genuine reset in expectations or a clear return of volume and momentum on the long side (put/call and VIX spikes would help signal that). The put/call ratio isn’t high enough to put in a low. It was around 0.85 at the close today. I like to see it above 0.9, preferably above 1.0, to see a strong move higher off the lows.
Tomorrow brings Apple and Amazon—still treating these as selective premium-selling opportunities on rich implied moves and clear technical resistance rather than aggressive long setups.
Stay disciplined, manage risk tightly around Mag 7 earnings and Nasdaq lows as the Mag 7 week continues.
