S&P 500 Breaks Out: 3 Trend Lines Point to 8,000, Then WATCH OUT!

The S&P 500 makes a new all-time high. What is the upside target? How much upside is left? I'm going to go in and deep dive into this chart, give you all the technical analysis as well as my forecast. Before we do that, my name is Gareth Soloway, Chief Market Strategist here at VerifiedInvesting.com. So, great day today. S&P 500 new all-time highs. The Nasdaq's been hitting the new all-time highs over the last couple weeks. It is gangbusters even in spite of a 10-year yield that continues to hover around 5.3%. Now, the first thing is to discuss why the markets continue to remain so strong in spite of yields which are basically at 20-plus-year highs. I have a graphic for you I want to show you. I think this is really, really important right here. Take a look at this. Let's zoom in on it. So, six reasons markets keep going up with rising yields. These are amazingly insightful factors. So, number one, we got the PCE data last week and it showed inflation was inching down just a little bit. It came in below forecast. Now, it's not back to the 2% that the Fed wants, but at least it was abating and slowing more than the market had anticipated. So, remember, when you're talking about reasons why yields go up, there's two reasons. There's economic activity, which is a good reason for yields to go up, versus inflation. If inflation is going up, it's a bad reason. But in this case, inflation's coming down. In addition, if we go back to that graph, growth-driven yields. And this is what I was just talking about. Yields are going up because we got the ISM data recently. We got the PMI data. Manufacturing services are all cranking. Yes, the jobs data was a little bit weaker than expected last week, but for the most part, we're still gaining jobs on a monthly basis and the manufacturing and services sectors are roaring right now. So, again, that's a reason why yields can go up and it's not a horrible reason. The next reason, and this gets even more interesting, is that everyone's yields are going up. So, European yields, they're raising interest rates there. Japanese yields are going up. Everywhere you look, yields are going up. So, guess what? As you can see in this image for number three, the house in the middle is the U.S. And even though yields are going up in the U.S., it's still the best house on a nasty block. And that means that investors are going to say, hey, listen, we have a choice here. We could go invest in Japan. We could go invest in Europe. Wait a minute. The U.S. is still the best. We're going to go to the U.S. The next one, strong earnings. So, this is the kicker here, folks. A good economy pushes yields up a little bit, but it also helps in earnings. So, we're coming into earnings season and earnings have been amazing for a majority of the big companies, the ones that anchor the S&P 500. And so, as long as earnings growth continues like this, the S&P can continue to go higher because on a relative basis to price to earnings, it is still cheap. In fact, the S&P is cheaper now than it was earlier this year because of the earnings growth. Think about that. That's something very important. Next up, we have earnings season ahead. So, now we're coming into earnings season, which starts next week with the banks, then the tech stocks after that. And it's expected to be a blockbuster earnings quarter again. Big earnings growth. Investors are piling in. And lastly, new quarter inflows. So, it's the beginning of the quarter. It's the beginning of the fourth quarter. Not only are hedge fund managers chasing to try to catch up their numbers to essentially beat the S&P. That's how they have to present it to their investors that, hey, we did better than the S&P this year. But we also have to realize that retail investors have been conditioned to buy the dip. And therefore, they're going to be keeping the push money in the market, thinking Now, on a technical analysis basis, let's jump over to the charts right now. So, here we are. The S&P 500 right here, new all-time high, taking out the highs from August 13th. Now, if you look at the chart, this was a very clear bull flag. Move up. Look at this beautiful inside bar pattern. There it goes to the upside. Now, this is where things get even more interesting because I'm going to give you guys my upside target. So, I've been bullish on the S&P. You know I had the pivot line on my other chart. In fact, we can flip over to that other chart right here. Here it is. This is the one I've been following. Like, literally, when we were back in mid-August, I was like, guys, as long as we stay above this neutral zone, which the neutral zone is this zone right in here, then the markets remain bullish. The one day, the one day we closed below this trend line was right here. And it sold off in the afternoon after the Fed raised rates and was super hawkish. And I said right that day, and you can go, and I love YouTube, by the way, because you can always go back and check this and verify it. But I said that this is actually good for the markets that the Fed was so hawkish that they raised rates because it shows that there's finally an adult in the room that's willing to do what is necessary for the U.S. financial system. That's actually bullish, right? It's that instead of just printing, and by the way, I still think they'll go back to the horrible policies when things get rough in the economy. But at least for now, the markets are like, OK, Kevin Warsh is not being a stooge. He's not being a pushover. He's doing what he needs to do. And sure enough, markets reacted the next day, up, up, up. We then consolidated as yields kept pushing. But again, how many times did I say in these videos that yields kept going up, oil kept going up at that time, and the markets were still like 2% off their all time highs? Talk about resilience. My word of the week of the month of really the last month, I would say, was resilience. The markets were doing great. So I said to you guys, as soon as there's any sort of small pullback in yields or oil, this market's going to rip up. And sure enough, here we are. So here you have the S&P rallying up. We took out this high again from the 13th to the 15th of August, up, up and away we go. Where are we going? I'll show you on that other S&P chart. I want to draw it in with you. So if we flip over to this S&P chart, there's two major trend lines to watch. So number one, what we want to look at is a shorter term trend line here that basically goes back to the previous pivot high. So what we want to do is we want to take this trend line and we stretch it all the way out. Now, what I love about trend lines is it really tells you a lot. What this trend line tells us is that every time we hit this yellow trend line that I just put in, we saw a sell-off. Now, some sell-offs were small, some sell-offs were big, but what do we know? We've never gotten above this trend line. So based on TA, technical analysis, we know that again, we can see here, then here, and we went again. Then this was the bigger sell-off in 2025. We then almost got back to it, sold off in 2026. We came up, we hit it, we sold off, hit it again, and sold off. And so what this does is it formulates a very logical expectation that yields should go up here to 8,000 and then see some sort of pullback. In addition, check this out, guys, there's an additional trend line going back to the COVID lows that goes right through those same pivot points. Look at this, guys, right up to that same level. So again, and by the way, why do I like that trend line? Well, not only are we taking a major pivot low from COVID, but look at how it behaves. Right here, we broke, we went up, we tagged it, we fell, we tagged it, and then we have never gotten back to that line until right here, we pull back here, and you have to assume. So notice how those trend lines are coexisting basically right around 8,000. That's going to be two ceilings, meaning two walls right above the head of the market that is likely going to cause a reaction. So while I've been bullish on the S&P since 75, 75, right, basically what I'm saying is now that as we get close to four or 500 points above that level, which is the target, I'm going to be looking to be a little bit more conservative on my longs and interested in potentially shorting the market. Very cool stuff, guys. Charts are absolutely amazing. Again, there's so many interesting signals in the charts that we can go over here. I would like to point out one more, but wait, there's more, right? Before I do that, by the way, I just want to show you guys this. So just a reminder that you can join my YouTube, and guys, the next thing I'm going to show you, trust me, stick around, Gareth's Top Squad, live Q&As once a week, exclusive videos every week, epic discounts every week to verified investing, swing trade alert charts posted to members. So again, 10 bucks a month. It is a no-brainer. Just the Q&A alone is so educational. I literally spent 45 minutes answering questions from all of the members out there, and we talked through strategy, we talked through risk management, money management, investing levels, et cetera, gold, silver, oil, stock markets, stocks, et cetera. It's awesome. 10 bucks a month, you get like three or four of those a month alone, not including everything else. No-brainer. All right. Last thing, look at this. Like I said, but wait, there's more. Take the low here from 2026 in March, bring it up to this low pivot, extend it out, and what do you see? I mean, look at this. This is so freaking cool, right? So you can see how this low pivot from this year, we then hit it again here, we then came up, hit it here, we broke down, then it became resistance, we fell, and where does that line coexist? At 8,000 on the S&P. That's the money spot, right? That is the level. We get to 8,000. I'm going to start taking some shorts on this market. Looks good. That's the target here. Bull market continues. Now, is that going to be the end of the bull market? I don't know yet, but I'll keep you guys updated. That's for sure. At least that's going to be a level where I short for a swing trade, no doubt about it. Have a great rest of your day, guys. Take care.