Problem

azd x watch monitors file changes to trigger rebuilds, but it watches everything in the project directory — including files and folders that should be ignored (e.g., node_modules/, .git/, build output, test artifacts, IDE config). This causes excessive unnecessary rebuilds that slow down the inner dev loop significantly, especially in projects with many generated/transient files.

Impact

• Constant rebuild churn: A single npm install or go build can trigger cascading rebuild cycles as output files change
• Slow inner loop: Developers wait for rebuilds that serve no purpose
• CPU/resource waste: File watchers fire on irrelevant changes

Proposed Solution

Add ignore file support (e.g., .azdignore or reuse .gitignore patterns) so azd x watch and similar file-monitoring commands can skip irrelevant paths.

Options to consider

1. .azdignore file (new, azd-specific)
2. Respect existing .gitignore patterns by default
3. watch.exclude config in azure.yaml
4. Combination: respect .gitignore + allow .azdignore overrides

Current Behavior

All files/folders in the project directory are monitored. No way to exclude paths.