S&P 500 Is 50 Points From A Breakout To 8,000 - Oil Flow Surges Through Strait, Yields At Resistance

Hey folks, welcome to verifiedinvesting.com. My name is Gareth Soloway, chief market strategist here. Now in today's video, we're going to cover the setups going into the week. We're going to look at the S&P. We're going to look at the yields, the major driving forces, inclusive of oil, gold, and Bitcoin, to find out what the likely movement is this week. All right, so number one, the biggest headline over the weekend that I thought was interesting is that shipments of oil and natural gas through the Straits of Hormuz have now hit a six-month high. What that tells us is the mine-clearing efforts by the U.S. and the naval blockade, that is having an impact, and more gas and oil are getting through. Now listen, the oil price is not going to collapse down, but it explains why oil was down late last week and has not gone as high as many people had thought it would with the strikes from the Houthis on Saudi Arabia. So very interesting there. Now again, I am bearish on oil. I am short on oil. So we'll see where things go. What I'm watching this week is the diesel price. You want to see the diesel price start to correct. If that corrects, the stock market, in my opinion, will see a boost because that, my friends, is the biggest driver of inflation. Remember, gas prices for you and me stinks. But really, when we're looking at prices getting passed through to consumer goods, diesel, which is the transportation factor there for goods getting pushed all around the country, all around the globe, that is the crux of the issue. All right, let's jump into the S&P 500 here and take a look going into the week. Overall, not a lot of other major news. We remain above the bullish bias zone here. So this, again, this trend line denotes as long as we are above this line, I remain bullish on the markets. And I would just remind people again that while things can turn on a dime, we have to keep in mind that the markets remain within basically 2% to 3% of all-time highs in spite of 5% yield, a Fed that looks like they could hike again in October. Odds are now 50-50 that we'll see another hike in October. And if not, it looks almost guaranteed for December unless we get weaker economic news. And also, we're looking at these oil prices at $100 a barrel. So all of these factors, all of these negatives, all of these weights on the shoulder of the market continue to be semi-ignored by investors. The buy-the-dip mentality is strong. Now, at some point, it will break, and it will be one of the nastiest sell-offs we've ever seen in the market. But until it breaks, until we get into the neutral zone and break below the neutral zone to the bearish zone, I'm not favoring that near-term outcome. Now, just to look at this, guys, we see very clearly. Here is your pivot point. Notice this was the Fed decision where you saw the afternoon panic selling. And then the next day, look, we ripped up. It was almost like a trampoline bouncing here and just ripping to the upside. And we're back above this level. In addition, I've showed this to you guys before, but remember, if you know your technical analysis, connect your highs here. So number one, this level gives us a firm breakout of this pattern, right? So again, here is your flagpole up, right? If you know your bull flags, and here is your consolidation, the breakout occurs basically above 7,700. So if this week, and right now we closed at 7,650 on the S&P, so we are 50 points away on the S&P from a breakout of this pattern. If that breaks out, it should be a very sharp vertical move to new all-time highs, and possibly as high as around 8,000 on the S&P. Now again, 8,000, is that a huge move? No, actually it's not. But nonetheless, from current levels to 8,000, we'd be talking about a four and a half to 5% move. All right, so that's number one. Number two, what we talked about in terms of the bull flag here, and why I continue to be bullish, is that if we drag a parallel down here, look at this. So again, low pivot, low pivot, low pivot. We pierced it here, and then it rebounded right here. So again, you've got this beautiful little parallel of consolidation of digestion from this recent move to the upside, and that again remains bullish, all right, for me at least. All right, so again, we'll watch this neutral zone. If we were to get below there, not on a Fed craziness in the afternoon type scenario. And remember, generally you wanna see a close below, but then you want it to trade below that for a few days. Otherwise, it's kind of like, okay, was that just panic? And on the Fed, it obviously was. Even though I came out and I said, guys, we're gonna probably rally off this because a hawkish Fed is really, really good for rates coming down weirdly enough because it gives confidence in the US financial system. All right, so that's where we are on this front. Just a reminder, guys, again, you can join Gareth's Top Squad right here on YouTube. And again, this is my YouTube premium. It comes with live Q&As. I just did a live Q&A with all members yesterday. Exclusive weekly videos, epic discounts, and swing trade alert posts. I usually get out at least two swing trade alert posts per week that are chart setups where it's like, okay, we're hitting a buy level or this is the buy level approaching or this is the short level approaching. And it could be anything from crypto to stocks to oil to gold, whatever it is, anything is kind of fair game in this. And it's only $10 a month, which I think is the coolest thing overall. It's just kind of the, you know, listen, you wanna see the live portfolio, you come to Verified Investing, you see my live portfolio, you see how much, how many shares, tokens if it's crypto, commodities, I trade ETFs, so you see shares for there as well. But you see everything. My P&L, how much I'm up, how much I'm down, how much I've made for the year or lost for the year, right? Here on YouTube, it's a low hanging fruit, only $10 a month versus 100, 150 on Verified Investing. You don't get the live portfolio view, but you still get amazing stuff. All right, let's get back to the charts here. So we've looked at the S&P 500. I go into the week still bullish on that. Let's look at crude oil. We were just talking about this. Crude oil did exactly what we talked about here. This was beautiful, folks. And again, beautiful move up here. We did see rejection off that price. This is a forward month contract, so we really do wanna look at WTI via this chart here. And this shows us where it closed on Friday. So again, same sort of deal, though you have ascending trend lines coming right up here, which give us our highs. You can see that late in last week, we started to pull back. I still favor a pullback on oil this week. I'm expecting a move down to about $93 a barrel this week alone. Eventually, I'm actually anticipating a move even lower down into this trend line. So kind of target one, target two. Notice how target two aligns right with this level. So that really gives us a good confluence of factors. But this is what I expect to hit this week. So that still leaves basically 7% downside on crude oil going into the week. Let's look at gold real quick, guys. Gold continues to do its choppy stuff here. One of the things I like showing here is this trend line right here, which marked the top. I gave you guys this top as a short trade. We made money on it in smart money commodities. As it came down, there was also opportunity to quickly go long. But really at this point, we're stuck in kind of a purgatory with gold, right? And again, I know bulls don't wanna hear this and I'm a long-term bull, so I don't even wanna hear it. But at the same time, we've broken out, so that's good. But now we're capped up here. And I think into year-end again, we're likely gonna see something along the lines of just up and down choppiness. Maybe we can get back and retest 4,800 and that'll be obviously up towards 5,000 by year-end if we extend the trend line out. But for the most part, I don't think we're going on another master bull run, especially if the Fed continues to hike rates, right? So the idea here is that while rates generally, generally high rates are not good for gold because it gives people an alternative. Not you and I who really believe the fiat system may be in the throes of collapse here over the next five, 10 years. But in general, people will look at it and say, okay, the Federal Reserve is the adult in the room. They wanna essentially give credence back to the financial system. I don't believe long-term it'll happen, but that's what they're trying to do. I give them credit for showing good force here. And what that does is the more confidence in the US financial system that investors feel, the less urgency to own gold, right? Because the whole idea of gold is that it's a safety net against everything that is out of control in the government and so forth. Now, the government's still not gonna slow down on spending, but in the near term, a hawkish Fed generally is not the best for gold. Down the line, I think the Fed goes very dovish and that's really where you wanna, I think 2027 and beyond is where you wanna really hold gold. But into the end of 2026, likely more neutral sideways chop. All right. So that's your silver update there or gold update, I should say. Let's look at silver real quick here. Silver, same sort of deal. You kind of have this little like parallel zone here. If we were to break down here, I'd be nervous. We would go back to 55, 54, maybe even $50. But right now, again, kind of the same thing, inside bar chop in between resistance and technical support with an eye out in case this trend line breaks, that's where you and I will be able to buy at much cheaper levels if that level breaks. Bitcoin, overall, we're gonna go into rates as well because I think rates are important here. But interest, Bitcoin, little bit of a pullback today after the big surge. Again, it held my major technical level. So you've gotta remain bullish. I am concerned about one thing. So I actually am favoring that we're gonna make a new high now. So a higher high, I should say. So remember, my big crux has been like, well, technically the bear market's not dead because we haven't made a higher high. I actually think that's gonna happen. Late last week's move is very bullish. We're so close. We just have to get above 82,850 approximately to make a new high. My bigger issue is this trend line here. This is gonna be a big test for Bitcoin bulls, okay? So yes, we can go up. This takes us to about 85,000. But look, this ascending trend line here, which is the bearish pattern formation right there, right? That now comes into alignment with over here, you start getting into all this sideways chop. And again, that is gonna be the next big test, in my opinion, this area right in here. All of this sideways digestion, if you look at all the volume that was traded in here, there's a lot of people that are sitting there that kind of got crushed when price broke down. They're not quite at break even, and there's this tendency psychologically to take profits or exit the trade for break even when you get smoked on a trade and you're down significantly. So there's gonna be a lot of pressure in here, and it is gonna coincide with this ascending trend line. So again, I think we go to 85, maybe 87,000 on this next move up, which is still great. From here, I mean, from 80,000 or so, I mean, that's still almost 10, well, about seven, 8%. But once we get there, that's gonna be where we could see a pullback in price. I'll be looking, if we do make the new high and go there, I'll be looking to buy that pullback when it pulls back into technical support. All right, so that's another little rundown on Bitcoin, the next level, and again, I expect it to make a new short-term higher high here, which is, again, should put a thumbtack, which should, in the bear market. So again, then it would be okay. Now we buy pullbacks instead of looking for new lows. And really at that point, then it's just monitoring it with, I would be, the only thing that makes me nervous is that I still won't trust the stock market. As much as the stock market continues to grind up and I'm bullish near-term, which makes sense why I'm, if I'm bullish on the S&P, then I'm bullish on Bitcoin generally as a risk-on asset. But again, the only concern I have is if we ever saw a big dump out in the stock market, then just the panic alone could potentially push Bitcoin down. All right, couple other charts I wanna look at. This week, guys, we know what we're looking for here. We have to be following oil and this chart, the 10-year yield. Now the 10-year yield is into double top. It should pull back. Again, we saw the pullback the day after the Fed on confidence in the U.S. financial system. Then the Bank of Japan came out and said, oh, we're gonna be more dovish. And the market was like, uh-oh, here we go again. Central Bank's going back to their playbook. And that's the concern right there. So watch this level here. I do not wanna see a daily close above 5.02%. If that happens, that's trouble, all right? As long as we stay below, I'm bearish on yields, which by default makes me bullish on the S&P 500. I'm also bearish on oil, which again, oil and yields have been moving together, so that makes sense as well. And again, short-term, I'm more neutral on gold and silver. Bitcoin's still a bullish bias, but obviously a lot of the gains are already in. You gotta be a little bit more careful here. And I'll just continue to keep you guys in the loop. Thank you guys so much. I'm excited for the trading week. Come over to verifiedinvesting.com and check out everything. By the way, if you download the app, there's so much free analysis and technical analysis and insights on the app or on the website. Even if you have a free account, it's pretty darn cool. So check it out. Have a great rest of your day, guys. Take care.