Dollar-Yen Collapse, Oil Keeps Pushing Into Key Jobs Report As Investors Trade Stocks, Gold, Bitcoin

My name is Gareth Soloway and I was a
losing trader until I mastered [music]
technical analysis. Logic and charts
beat hype and narratives every time. Now
I teach investors the same [music]
techniques that made me a
multimillionaire. 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, there is big action in the currency
markets today. We're seeing the
dollar-yen collapse. What that's telling
us is that there's intervention actively
going on in the yen to strengthen it,
pushing the dollar lower. I want to
start with that chart because it is a
big deal. Take a look at the 10-minute
chart here on the dollar-yen and look at
the drop that we've seen in the
overnight. Just continued grind lower
and that tells you there's consistent
intervention going on here. Now, why is
this going on? And we'll look at the
daily chart in just a minute because it
had a breakdown with a bear flag going
into this. It almost choreographed that
this was absolutely going to happen. But
the idea here is very simple. Yields.
Yields are the root cause of basically
every issue in the market right now.
Yes, oil is high, no doubt about that,
trading around $92 a barrel currently,
but that's just adding to yield pressure
because it's inflationary, right? So,
the idea here is this is that Japan is
the biggest holder of US debt, so US
bonds. And because their currency has
been weakening, it's forced the US
government to assist Japan in
strengthening the yen, right? You can't
have the yen ultimately collapse in
Japan. And Japan, to strengthen the yen
if the US wasn't involved, what would
they do? They would sell US Treasuries
or bonds. What would that do to yields?
It would spike yields even further. So,
the US comes to the rescue and says,
"Hey, listen, we will help you do this.
Just please don't sell US debt on the
open market to do it. We'll help you do
it. In fact, the last time the
intervention occurred, the US sold euros
and used that money to buy yen. So,
there's this a basic back-and-forth
going on where you're having a
coordinated effort to strengthen the
yen. All right? To essentially help
Japan so that they don't have to drop or
dump US debt, which then causes or would
cause a further spike in the US 10-year.
It's remarkable. I mean, really, if you
think about it, the inner workings going
on right now absolutely phenomenal. Now,
if we look at the dollar yen, look at
the drop yesterday. So, someone knew
yesterday this was going to happen. And
then look at the collapse today.
Monsterous two-day drop. But bigger
this, remember, if you followed when
we've looked at this chart over the last
couple weeks, we were talking about this
major ascending trend line. Look at how
every time you came into it, it worked
as perfect technical support until it
didn't. And when it finally broke, what
type of pattern formation is this? You
know, basically a little quiz for you
guys to quiz yourselves on. Down move,
breaking support, consolidation like
that. If you go to a textbook under bear
flag, that would be precisely that. So,
what does a bear flag tell you? When
you're making it, it tells you
eventually the asset that we're looking
at is going to have a fall. And that's
exactly what's happened here. Notice
where the dollar yen has fallen to. We
take this low pivot and we drag a trend
line right across, and lo and behold, we
go right there. Just right there. Look
at that. Isn't it amazing how, you know,
charts look so arbitrary sometimes and
kind of like chaos, but there's actually
sense that can be made out of them,
which is why technical analysis amazes
me after 27 years. It still floors me
how it works relatively well, not all
the time, but relatively well again on
the chart analysis side. All right. So,
dollar-yen in freefall here, that means
the dollar is weakening. So, that should
mean that if we go to the DXY, it should
be weakening, and the answer is yes.
Remember yesterday we discussed this
very chart and we discussed how we had
support and a bounce. Came down,
support, bounce,
support, and instead of a sharp bounce,
it bear flagged, broke, and then look,
same pattern, inside bar consolidation
yields a down move. We talked about this
very setup in I believe just yesterday's
game plan. So, sure enough, the dollar
is coming in. The chart helped us
understand that was the most probable
outcome, and again, it comes down
beautifully. Now, with that, so
think about this.
If the US is involved with Japan to keep
Japan from dumping
bonds. If the US gets involved enough,
Japan says, "All right, if you really
help us, we will buy more US debt."
All right? So, what do you think the
10-year yield is doing? The 10-year
yield is falling today. Look at that.
So, we are backing off. Now, if you go
to yesterday's game plan, and of course
these are all on YouTube for you to
confirm, we said yesterday, or I said
yesterday, that we had hit a double top
short-term on the 10-year yield. Okay?
So, the 10-year yield here, what does
that tell us? And what was my exact
quote yesterday? Is that resistance
levels are to be respected until they
break. In other words, resistance is
resistance. It should reject price until
it breaks. Then we say, "Okay, it
broke." We step back. But it meant that
I was talking about this, and we talked
about how I was still bullish on the S&P
in the very short term because until
resistance is broken on the yields, we
should pull back on the yields. And if
the yields pull back, what does the
stock market do?
Goes up, right? So, there you go. So,
yields are pulling back today. What is
the S&P futures doing? Look at this.
S&P futures pushing up in the early
trading session. So cool how it's all
coordinated. Again, once you start
understanding the nuances of this stuff,
it doesn't listen. I still have my fair
share of losses, right? I mean, I
certainly am not a perfect investor or
trader, but I will say that I have
become the casino. Yes, I will lose just
like a couple gamblers come into the
casino and win, but over a maximum
amount of trades, 100 trades, 1,000
trades, I am winning a majority of the
time, and that's why. It's because I've
shut down my emotion
and said, "Hey, listen, I'm not going to
look at social media. And if I look at
social media, you know what I'm going to
do? I'm going to use it as a contrarian
indicator. I'm not going to get caught
up in the hype. I'm not going to FOMO
in. I'm not going to fear and panic and
sell at the bottoms. Instead, I'm going
to go to the charts and let the charts
tell me what to do. I don't tell the
charts what to do. I don't tell
anything. The charts tell me." And when
we get to that point, we put ourselves
on par
with at least the bigger institutional
money, which is always trying to bully
the little investor, you guys out there,
and me to some extent. It's trying
They're trying to bully us into doing
the wrong thing at the wrong time.
Essentially, what the big players want
when they're looking at traders, swing
traders, etc. Long-term investors not so
much except in panics where even
long-term investors fret and sell at the
lows, unfortunately, ala 2009.
But basically, we're able to withstand
the forces that they're they're pushing
on us and actually step up to their
level. Very cool stuff. All right. So,
back to the charts we go. We have the
futures on the S&P pushing up. If we go
to the S&P daily chart itself, remember
I put in these little notes here,
bullish above this trend line. So, still
bullish on the S&P. We're up today in
the pre-market. If we break below this
white trend line, I would go neutral on
the S&P all the way down to the yellow
line. And if we break the yellow line,
that would be a major breakdown in the
structure of the market. Now, some of
you guys may be wondering, well, what do
we do up here? Well, I'd have to wait
and see. If we rally all the way back to
the highs, there's a chance I would
swing trade a short there because
remember, every time it's hit, it's
pulled back. But, I'd have to reevaluate
at that a minute, right? Or at that
point when we're hitting that line. And
I think what's important to understand
is that
the way
a chart comes into a level
is almost as important as the level
itself. Like, if a chart doesn't come
into the level the right way, it could
be a great level and I still will be
like, "Nah, I don't like it. I'm going
to stay back." And that's the discipline
that allows me to understand that not
all levels maintain their their
strength. Some resistances will weaken
the way a chart gets up into the
resistance. Some supports will weaken as
the chart gets into those supports.
These are all intricate details that
when you study the markets, and what I'm
here to do is help you guys learn this
stuff, you start to see what I'm talking
about and do it for yourselves. Very
cool stuff. All right. Um so, we've
looked at the S&P, we've looked at the
dollar, the 10-year yield, um the
Japanese US dollar yen, which again
hitting technical support down here. Um
I do want to move into stocks in motion
because we did have a big earnings
report yesterday from Broadcom. Now,
Broadcom reported earnings. Their
earnings were really, really good. Their
guidance was great, but great doesn't
cut it anymore with these AI chipmakers.
All right, it was it was basically a
little bit weaker, even though it was
showing like crazy growth, like 200%
growth,
the guidance was just fractionally below
the crazy bar Wall Street had set for
it. So, the stock is down last I checked
here. Let's take a look. Only down a
little bit, but it is down nonetheless.
Now, if we go to the daily chart, in
terms of the level for me today, I have
a good level for a trade. Might even be
a good swing trade level here that
basically is this gap fill. So, we can
see here, there's a a gap from the close
here to the open. It creates a gap. And
then, so that would be filling the gap
if we come back down here. Price would
have filled the gap. And then,
interestingly enough, notice it says 786
Fibonacci retrace. If I take my low here
to my high, and we just drag it across,
the 786 aligns almost to the penny with
that level. Now, in technical analysis,
one of the key metrics is that one level
is good. It's good. You know, maybe a
little bit more than 50/50 odds of the
level working in your favor. If you can
get two factors, you push yourself up
towards 70% success rate, right? And
that's really, you know, once we get 70,
75% success rate, that's where you
become the casino, right? Where you're
like, "Okay, if I do 100 trades, I'm
winning 70 to 75 times. If I do 1,000
trades, 700 to 750 times." That's where
we want to be. That's the zone. Now, can
we get it to 80%? Yes. You know, you
need multiple more factors aligning, but
it gets hard to get it up there because
the market can do things that you don't
expect, and you always have to build
that into your equation when you're
looking at factors and probability. All
right. So, Broadcom here guys, if it
gets down to this level here at 333,
still a quite a ways away. I don't think
it will get there today, but if it does,
that would be a really good trading
opportunity. Aggressive traders, there
might be a scalp around 34260, which is
the low from the gap up day. Again, that
would be only for aggressive day
traders. Snowflake, wow. What a
rip-roaring rally on Snowflake today.
Monster earnings, monster guidance.
Obviously, the stock having a huge move.
The stock right now is up a whopping
24%.
Now, daily chart. Where we day trading
this? Where would we short? All right.
So, again, the stock's already up, so
I'm not chasing it, right? And again,
I'm not going to pay up. I don't go to
the supermarket and say, "Hey,
a gallon of milk is now $20. Let me buy
five of them." All right. We don't chase
price. We say, "No. We're disciplined."
All right. If it pulls back, I might be
a buyer,
but if it goes up enough, I know price
in general will have a retracement to
essentially a key level. So, right now
we have double top from this pivot from
2021 between 403 and 405. I will be
eyeing that one as an opportunity for an
intraday short. I don't think I'll swing
trade it there. Swing trade more likely
would be a double top over here from
2020 in December at around $430.
Network Appliance or NetApp dropping on
earnings here today. Not a huge company,
but nonetheless falling. There's
obviously a monster gap fill. Look at
the size of this gap. That's a crazy gap
right there. But, basically back to
about 143 to 142. There might be a
scalpable level around 150 to 151 right
here, this pivot low. I could see myself
maybe day trading that pierce of the
even number because the even number is
there as well. We also do our fibs. I
didn't do this before, but you have your
low pivot here all the way to your high
and interestingly enough, look, 50%
retrace right there around that 150 151
level. So, yeah, there might be a quick
day trade there, certainly not a swing
trade until at least the the gap fill
down here at 142.
All right, let's move on to commodities.
Gold intraday surging as yields pull
back. Remember I told you guys about
this. You go back a few days we talked
about this key technical level and how
gold should get a bounce uh to the
upside and look at the bounce that gold
has seen. Notice yesterday yields were
down on the 10-year, today yields are
down again. What does gold do? It rips
right to the upside. So, really that's
the game plan here. It's It's simply
put, obviously the dollar weakness is
helping, but those are kind of
coordinated, uh but dollar or or or
yields on the 10-year down, gold is
generally going to trade up at least for
now. So, gold rallying up beautifully.
Uh again, good look at the technical
level of support here, beautiful little
level right there, good bounce, big drop
into it, and again, a catalyst for the
upside. Minor resistance will come in
right here at around 4520
on gold. Now, one thing we do want to
follow on gold, could we be making a
little bit of an head and shoulders
pattern? Maybe. It's something that is
just potentially forming, but if we were
to roll over again,
I'd be worried. If we break this line,
you get quite the move down. Likely this
would take us back to $4,000. Now,
granted, this this right shoulder is is
not even formed yet, so we don't know.
I'm just overall just warning. As a
technical trader,
I'm always looking for potential setups.
Now, they don't trigger me to do
anything. Like, I'm not shorting gold
because of this, but what I do is I make
a mental note to keep it on my watch
list. I say, "Okay, well, you know, this
is a pattern that has 2/3 of it formed.
We still need the final 1/3, the final
shoulder. But if that were to form, I
need to be aware of that because it will
give me a trading opportunity in the
future. All right, so keep an eye on
that. Uh silver today, same thing, nice
little bounce to the upside, came right
into pivot support levels. Notice high
pivot, broke out, consolidated, pushed
up, retrace into that level, getting a
technical bounce there. Uh crude oil,
let's look at crude oil here. Crude oil
was up substantially making a new high
around $93 a barrel. Notice where did it
go? It went right into this pivot top.
It is pulling back now, still green on
the day, but it is pulling back. I'm
actually a little bearish on oil here. I
think oil is going to at least come back
into this $84 level, which honestly from
here is a pretty good pullback. So
again, watch for a pullback on oil to
about this level. Uh one of my favorite
shorts remains Valero. Valero, which
right now is trading up about a buck 50
premarket. Look at this trend line here,
and this is more of a swing trade.
But Valero again, uh into major
resistance, extremely extended, starting
to put in negative divergences. Uh I do
think that this refiner is due for a
significant correction on a swing trade
basis. And I do have a position in this
one on the short side with members of
Smart Money uh Stocks and ETFs. Now
going to natural gas, nat gas, remember
I've been bullish on it since that
breakout, and sure enough, we're seeing
it today just fractionally down, but
look at this nice move up, and then so
you could see very clearly, we're just
hammering on this level. Basically, the
$3 pivot point here. Let's see if we can
get above that. If we get above that, we
should head to about 315
on natural gas. Remember, seasonality,
uh we also get inventories today at
10:30 a.m. Eastern time, so that will be
a key factor to watch. Speaking of data
numbers, we did get jobless claims
today, but they were nothing to write
home about. 203,000 I believe or maybe
205,000. Whatever the number was, it was
very, very low. Again, nothing below
250,000 in terms of people filing for
unemployment gets my attention
economically. That's very low
historically. Again, nothing to write
home about. All right. Lastly, let's
look at Bitcoin here.
Bitcoin is hovering and pushing up a
little bit. We're still kind of holding
this general structure. We do have a
short-term bearish pattern, but the
bigger pattern is now developing into a
more bullish pattern. So, let's keep an
eye on this. You have a cross current
here. We have a short-term bearish with
a longer-term macro bullish. Generally,
the macro pattern, by macro meaning big,
micro meaning small, the macro pattern
is generally going to control the bigger
move. So, as it continues to form here,
you know, we got a little bit of a
pullback. I was able to capture some
shorts gains on shorts in the crypto
markets in smart money crypto at
Verified Investing, my premium
subscription there. But, now it's
getting to be more of a
if this continues sideways, it could be
setting up for another leg higher. Where
could that go on Bitcoin? Well,
potentially, if we take out this high
pivot here, we could be headed back into
the 90,000 range on Bitcoin. So, again,
we'll watch it very closely, but you can
see here when we zoom out, you know, you
have the bear the small the short-term
reversal candle here, but the bigger
pattern is up and now sideways
consolidation. And this is amazing
because this shows you how every day we
get a new candle. And every day, it's a
new piece of the puzzle. And so, you
know, days ago, it could have looked
like, "Oh, look, it's an animal. Maybe
it's a dog. Maybe it's a cat." Now, it's
starting to formulate, "Oh, well, maybe
it is a dog. Maybe it's this type of
dog." You get more information. And I
think that's really important to
understand is that
you as an investor, as a trader, you
need to be able to be flexible. Okay?
You have to be able to say, "Nope, now
this is a this was a bearish pattern,
now it's a bullish pattern." Or, "Oh,
this was support, well now it's turned
into resistance." You have to be able to
do that. You learn that stuff, you
become humbled by the market enough, the
market forces you to learn it. Uh either
way, it's the key to success in this
game. All right, go have a great trading
day, guys. Thank you guys so much for
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Now, let's go make some money. Take
care.