Yields Ripping, Markets Panic But Bull Technical Signals Say Upside, Gold, Bitcoin

My name is Gareth Soloway and I was a losing trader until I mastered technical analysis. Logic and charts beat hype and narratives every time. Now I teach investors the same techniques that made me a multi-millionaire. This is my trading game plan. Good morning everybody. Welcome to my trading game plan. My name is Gareth Soloway, chief market strategist here at verifiedinvesting.com. So, yields overnight surging dramatically higher. Futures are down today. Although, I will say the 10-year yield is beginning to back off from its epic push up. So, in other words, yesterday we saw a massive move about 16 basis points on the 10-year. So, think about that and put it in perspective. The Fed hiked about a week and a half ago um 25 basis points. Just yesterday, the 10-year yield went up another 16 basis points. So rates broke out above that 5.02%. Are we going to confirm the breakout today or will we see rates come back in and get back below 5%. The markets are starting to get nervous. But I will say this, even when you take into account oil where it's been trading near $100 a barrel, rates now above 5% 19-year highs since 2007 was the last time the 10-year was up here. The stock market's still only down about 2% off all-time highs, and we're still above our neutral line, which as long as we stay above that neutral line on the S&P based on technical analysis, the charts say stay long, and that's what I'm generally doing. All right, let's jump into the charts and take a look. We'll start with the S&P futures here. S&P futures, you can see again, generally trending down overnight as we've seen the 10-year rally. And then look at this. We got a little bottoming tail on the 10-year chart um at 5:40 a.m. So 5:40 a.m. Eastern time very early this morning. That coincides perfectly when yields topped this morning. Yields have started to pull back. And what are we seeing? We're seeing the S&P futures slowly rally off the lows on the chart. Speaking of the 10-year yield, here it is right here, guys. Look at this. The 10-year yield is now negative today, back below 5.1%. But if we go to the 10-minute chart, look at this. When did we top out? Look at that. Here it is. This is 5:40 a.m. Eastern time. Going back to the ES futures, this was your 540 a.m. Eastern time candle. So, notice the inverse relationship. when yields fell down or have fallen down, we've seen the S&P futures inch back up. It's really very very simple, you know, just to break it down. And yes, you could say, hey, there's a lot of craziness in the Middle East still, Saudi Arabia, Houthis, Iran, US. Um, yes, but it all for the markets. The markets strip out all the nonsense, all the extra stuff. They look at one or two things. What is the 10-year yield doing? Because that's the cost of borrowing money. That's the cost of funding the US deficit. That, my friends, is whether or not the Fed has to raise rates, which inevitably will slow the economy. And if we see a slowing economy, what happens to earnings? Earnings will go down. The earnings growth that's been driving this bull market will stall. So rates boil down to essentially everything in the markets. I know it's crazy to think that way, but that is the way it is. All right, let's flip back over here. Let's go to the S&P daily chart. This is what I'm talking about when I say we remain on the bullish side. You can see right here, yesterday was a pretty nasty down day, down 3/4 of 1%. But I mean, look at this. Here was your previous all-time high. And by the way, at that point, where was the 10-year? So, if we go to the daily chart of the 10-year back on, and I'm just doing this now for the first time. Let's see on August 13th, where was the 10-year? August 13th, right over here there. So, the on August 13th, the 10-year yield was 4.67%. We are now at 5.1% on the 10-year yield and the stock market is down a whopping 1.5%. Isn't that wild? So, what I'm trying to do here is I'm trying to put this in perspective. In other words, even though rates are up 50 basis points on the 10-year, basically the S&P net is down 1.5%. That's not much. And what that tells me is in the short term, if rates pull back just a little bit, let's just say a pull back to 5%. So, another 10 basis points drop from where we are now, I think the market hits a new all-time high. And remember, the NASDAQ just a couple days ago hit a new all-time high. Just something to think about. Now, listen, I want to be very aware that while I am remaining bullish in the near term, it doesn't mean I don't have some shorts. There are certain charts like AMD the other day hit a major trend line. I shorted it. We're in the money on that trade. Smart money stocks and ETFs. Um in addition, it doesn't change my long-term catastrophic outlook that at some point probably around the 100redyear cycle coming up, there will be a decline that makes the Great Recession look like a minor dip. And I know that sounds scary and it does but it doesn't like even though that's scary it doesn't it doesn't mean I run for the hills from stocks right now because short-term markets are bullish but it does make me aware that I need to prep and prepare for that period. All right so again um you S&P 500 will be opening slightly lower today. We were down more but again as we saw the S&Ps coming back the dollar continues to rip up. We're now looking at a potential hit of this trend line at 10163. What a rally on the dollar here, folks. Dollar does not usually move this quickly in such a short time, but we are getting towards a resistance zone on the dollar. And if yields pull back enough with the dollar pulling back, and here's yields again, and we can see again, we're basically flat on the 10-year yield, then you have a recipe for gold and the stock market to get that next leg up. Speaking of gold, we can jump right into that. gold hit my key support trend line that I've talked about with you guys saying that as long as we hold this, we're in a sideways maybe slight up angle choppy zone. Let's look at that chart right now. Here we have it. So again, look at what I'm doing. Taking low pivot, low pivot gives us the high pivot. Then you connect these lows. We hit it right here. And look at today. We pierced, but we're back above that level. So, right now, nothing has changed from my outlook on gold, which is this type of action. And again, I do I'm doing bigger whips, but we don't really know how it's going to trade in here. But the point is, you have lots of resistance here. You have technical support here. As long as these two levels hold, this caps are up and down on gold in the near term. Now, we do have to watch because we know trend lines can break. If we were to break here, I would start getting concerned. Gold could honestly go back to 4,000 or so, maybe even lower, but right now it's holding. I give the benefit of the doubt to the bulls as long as we're on support and we haven't broken it. Therefore, again, you expect a technical bounce. Silver, same thing. Silver a little bit weaker than gold today. But look at the beautiful trend line here and here that are parallel. And look at where silver is. It's right on that line there. So, silver is still holding its technical support. Should that technical support break, there'll be a little technical level here around 59 to 60. Then we're looking at 55. If we see a break below that, now we have to talk about oil, right? I mean, oil obviously has been the biggest story aside from yields um that we've been dealing with as the Iran US conflict continues. Although there have been overtures in the last week or so to some sort of deescalation. I don't know if I'd call it a deal, but deescalation. And this is really, like I've told you before, the president has basically five weeks before the midterms. He's got to try to get oil down. And so far, it's working. These overtures, you know, even if no deal is struck, if he can get oil back down, that'll help. It's not down enough yet, but we should keep our eyes on it. So, let's go to oil and see what we have on the charts. It's bouncing again today, but notice it did hit technical support. So remember this was that great trend line which gave me that short here. We pulled back here. We tagged support. Notice what's happening right there. And we're getting a little bit of a bounce. Generally I'm expecting at this point for oil to kind of remain like this as well. If it breaks this orange line, that's where you get your next drop to about 87. I could see before the midterms we get down to honestly maybe as low as 80. I have a hard time believing we'll get below 80, but I do think there is a chance we could get down to about $80 a barrel. Now, keep in mind earlier this year before the Iranian conflict, we were in the 60s. So, it's still 30 plus%. Even at 80, it's still 30% higher, but at least it seems like some relief. Now, we got to get diesel prices down as well. Diesel obviously is a massive one. Most of us don't use diesel on a daily basis, but we do have heating oil in our homes as winter approaches. That is a major issue. And remember, diesel is the backbone of the transportation sector. So when you're transporting and I use you know lettuce or you know you know I don't know TVs and boxes all of these UPS trucks all of these transportation 18 wheelers most of them are on diesel and all of that money they're spending in addition unfortunately is going to get passed through to you and I when we buy some of these goods just it's just the nature of it. These companies are not going to be like oh darn we're losing money now and we're going to go out of business. They're going to say no we got to raise prices. We got to raise prices so our margins stay relatively good. We can keep our employees, etc. Um, and that's what they're going to do. All right, so that's where we are on oil here. Natural gas, uh, continues to kind of hover right around the breakout level of $3. It was up yesterday, pulled back, so it closed just a little bit up. Today, it was up kind of coming back in. I'm watching this like a hawk. Ideally, I don't need it to continue up here. If it wants to stay and go sideways, that's fine. What kind of pattern would this be? If we did something like this, that would be a bull flag, right? And then we look for that resumption of the move. So, what we don't want to see is price on natural gas go like this and then like this or any sort of steep decline, but sideways or up is fine by me. I continue to be bullish on natural gas uh heading into the colder months this year. All right, let's turn our attention to Bitcoin. Now, Bitcoin did pull back yesterday with gold and silver. No surprise there. Um, overall, you know, you have to look at it and say Bitcoin continues to kind of hold up relatively well. Uh, but overall here, let me just kind of find here. We'll go with this chart right here. But overall, again, Bitcoin continues to be in a mode that even on a pullback now on Bitcoin, this becomes technical support. So really again you could see how price this is how price works right it breaks out then it has this choppy period then if it can break out above that that level now becomes technical support for the next leg up. We have made a higher high higher high over here as well. So in the short term the bare market to me is over unless proven otherwise. In other words, odds before we took out that high was that it was a great bare market rally. I caught it with members here at Smartmoney Crypto, but it wasn't a new bull market. Now odds have flipped to favoring that the bare market has concluded. Doesn't mean we're not going to pull back, and I think we will have big pullbacks, but at least at least it looks like based on the data, the odds are favoring the bare market is over. All right, couple stocks on my radar today. Booking Holdings continues to collapse and again these stocks are all about the Muse news. Um Muse which is the Meta AI they had their conference yesterday by the way and Meta is down today. We can look at that chart in a second where the levels are, but that's a classic sell the news, right? So, the hype drives it up and then once they do it, it it might be great that the conference, but then people are like, "Okay, we heard it. We'll take profits now, right? I mean, it wasn't anything beyond what we people were expecting." But what it's doing is it's been crushing these travel stocks, the banks, anything out there that is in the sector where they collect fees or have margins that can be essentially cut down by AI that's happening. So booking holdings, I'm watching if we were to flush into double bottom here at 150, there should be a major technical bounce there. That's more of a swing trade, but maybe even tradable as a day trade. Um here we also have let's go on to uh let's go on to Bank of America. This is one on my radar. Major technical support around just below 55. Any sort of flush there that has an ascending beautiful trend line with this little pivot point here. So there are if we can get a little bit more selling there are some really good long opportunities in some of these beaten up short-term names. Now, one name that really doesn't have so much to do with uh the AI story, at least not yet, is McDonald's. Now, McDonald's got crushed. They basically are trying to, you know, they've seen their their share of the fast food market decline, and they're trying to make big changes. With changes come a lot of costs. And it's also admitting that earnings aren't going to be what they had hoped. But the stock was so oversold going into this news that dropped it yesterday 5%. We actually tagged a major technical level. Look at this guys. This is a long and I repeat a long-term channel. In fact, let me go to the weekly chart. Here we are and look at what we tag. Look at high from 2012 and basically marks every high pivot along the way. The low from COVID and we just tagged that level. So, what did I do? I bought a little bit. This is when I buy when everyone else hates it. When it's been beaten down, when it's at, you know, basically 52- week lows. When it tags the technical level, but everyone is bearish on it. I say, "All right, everyone's bearish, meaning that the sellers have all dumped, people are hating it, they're underinvested." Now, I say, "Well, listen, any sort of small positive and people will rush back into this thing." And I it's like a wave on a surfboard. You just take takes me right in. And that's the way I view it, folks. Most people will read the news on McDonald's on social media and be like, "Oh, they're done." You know, I mean, you know, you get the the emotional reaction like, "Oh, it's they're over." Maybe, frankly, I I couldn't care. All I care about is what is it going to do in the next month or two or a week or two or day or two. That's all I care about with the chart with the overallotment of bears. Reversion trade takes hold. So, that's really where we are right now. Couple other charts. I did mention Meta. Let's take a look at Meta here today. Meta's bounced a little bit off of its lows pre-market. Nice little sell, but again, as the stock market is bouncing, this is bouncing up as well. But nonetheless, Meta into a lot of resistance with two topping tails on the daily chart. Filled this gap right here. Good one right there. that is on my radar for a potential trade today. If it were to sell significantly, where would the support be? Where would I be a buyer? Right here. Take a look. See that? So, you basically have support, a piv former pivot, former pivot, former pivot breakout. So, where would we expect if price starts coming in? Where would support be? Right there. See that? Very cool. All right, guys. Let's do one more check on the 10-year yield. continuing to stay right around 5.1%. ES futures going into the open. Let's take a look. ES futures are continuing to float off of the lows, but still slightly negative on the day. You guys are rock stars. Thank you guys for being big supporters of verified investing. I really do appreciate everyone here does appreciate it as well. And as always, we're going to keep bringing you the data and the charts with no BS. Have a great rest of your day, guys. Take care.