Caution seems to be the topic before NVIDIA Corps NVDA Third quarter report.

What you should know: Nvidia will report its third-quarter financial results after the market close on Wednesday. The company is expected to report earnings of 69 cents per share on quarterly revenue of $5.77 billion.

At the end of the second quarter, the chip company weak guidance issued as a result of ongoing challenges in the supply chain. Nvidia noted that its gaming and professional visualization segments are expected to decline sequentially. However, data centers and automobiles were expected to remain strong.

Despite falling to a two-year low last month, Nvidia shares have done so has recovered strongly in recent weeks, tends to be higher in revenue. However, that may not bode well for the chip giant, according to Ritholtz Wealth Management Josh Brown.

Brown’s take: He added to his Nvidia position last month and plans to hold the name long-term, but the strong recovery in recent weeks is setting the stock for a dip in earnings, he said.

“I wouldn’t go into the earnings,” Brown said.

“I think we’re getting to the point where you want to take profits … that wouldn’t be the place for me to get really excited.”

He highlighted the technical setup in a broader sense VanEck Semiconductor ETF SMH.

“This group had a very similar rally from July through mid-August, peaking right at this falling 200-day moving average. Now we’re challenging the same 200-day moving average again,” Brown said.

Unless there is a massive break above the SMH 200-day moving average, the semiconductor names look to be headed lower, he said.

“And these companies haven’t been good at holding earnings all year,” Brown added.

Related link: Warren Buffett’s $4.1 billion stake disclosure drives Apple supplier’s shares up 8%

Bonus earnings: Douglas C Lane & Associates’ Sarat Sethi chimed in the conversation, noting that he expects Nvidia to cut the lead in this case…