10-Year Yield Hits Resistance as S&P 500 Tests Critical Support

[music]
>> Hello everybody. Welcome to Trading the
Close. My name is Drew Dosik. Now guys,
today started off a little bit of mixed
signals with the ISM PMI data coming out
this morning as well as the Jolts. Jolts
came in a little bit better than
previous and the IMM PMI basically came
in somewhat in line. A little bit of a
mixed signal there because ideally for a
Goldilocks zone, you wanted to see Jolts
come in just a little bit weaker giving
and providing less pressure on the Feds
for
hiking rates this month, folks. And
right now as it stands going into this
show, it's looking like a two to one
chance for a rate hike with yields
surging, US oil also surging today.
Guys, we're going to get into it as it's
starting not to look too rosy out there
near term with escalation increasing in
the Middle East. Plus, we've got a
specific angle of education that we're
going to help everybody out on today.
We're going to focus on the charts using
the simple moving averages. I've done
this with this
SMH in the past. However, everybody
likely has these indicators on their
charts. We're going to go through it,
give you a little bit additional insight
to see how you can use these indicators
on your favorite charts on your own
screen and garner information from them.
All right, let's jump into the S&P 500
first with the SPY on the daily time
frame. You can see here guys, what have
I been saying was going to happen and
what should happen because we talk about
this in this show so often. We talk
about breakouts and retraces to that
trend line from which it broke out from.
We clearly see we have a high pivot back
here on June 2nd. Today was the day we
had price come back in and tag that
exact same price point and get support
and bounce up off of this range. Now, if
you take away everything that's going on
in the background, this should be a
bounce setup. We have three sharp days
moving lower right into an area of
support. We should be bouncing up
tomorrow and testing the gap fill from
trading action yesterday. But with the
macro backdrop and with price action
already coming so close to this level of
support in essence weakening this area,
that's reducing probabilities of a
potential bounce. But, I would not be
surprised to see us up and close
positive tomorrow just because of the
technicals on the chart. We very well
likely will need help in the 10-year
yield and US oil department for that
bounce to materialize. We'll see if that
is a possibility when we look at those
charts. But, as I said, we're going to
go through education with the simple
moving averages on the chart and that's
what I flipped on to go over and I
highlight. This will be the same for
every chart. The yellow is the 20 moving
average, the blue is the 50 moving
average, and the red down here way down
at the bottom is the 200 daily moving
average all based off of the close.
Because guys, after all, this is trading
the close. And also, the close in my
opinion is probably the most important
piece of data on every one of these
daily candles. All right? So, as as
stated, we closed above this trendline
favoring a little bit of elevation at
least for tomorrow. Dell's helping with
that, too, which we'll check out with
that chart. But you see here, the 50 we
have still underneath current price. The
20 is above implying this could be
resistance popping into it, but this is
a s- more solid level of support. Should
we have price come down, break this
trendline, notice that is right on the
top range of this pivots back in July at
$755.
That's a near-term support on the S&P
500. Next up into the Qs down 1.27%
today separating from what was 3 days of
consolidation now finding ourselves back
down here in this lower range of price
action from August. So interesting
decline albeit with a doji candle
filling this gap and this gap today in
one move. We opened up pushed down lower
filled this gap and then pushed up to
fill this gap all in one move in one
day. So very interesting stuff and
notice here on the simple moving
averages a different story presents
itself. If you remember on the S&P 500,
the 50 moving average was underneath
providing a potential area of support.
That does make sense. The spiders just
made brand new all-time highs. Those
moving averages have moved up away from
price allowing that 50 to come up and
provide support. Not in this scenario
with this daily candle closed today on
the cues as we have that 50 moving
average now in its proper space to help
push price down. In that case, next area
of support $695.25.
Drawn out from this pivot low that you
see back here in May of this year. We
did get a bounce off of that area in
June and also we did get a bounce in
July. Pierced that range here later in
July then clearly that's going to be the
line much like what occurred on the S&P
500 for the area of support and bounce
that occurred today intraday price
action. Next up into the SMH guys, look
at this decline 2.05%
continuing to get rejected by this
declining trend line. Pushing price
further back within this parallel
channel one that I remind you and the
viewers a parallel channel dating all
the way back to the liberation day lows.
Now I flip on the moving averages and
this is what we've been tracing. This is
what we've been following because I've
clearly said if and when we have price
get above this blue 50 moving average on
a daily time frame and push through with
follow-up conviction, then we would get
into more bullish scenario territory for
the semiconductors. We had one day close
above that 50. All of the rest has since
been a technical rejection from that
area of resistance. We clearly see now
we're extending the distance away,
allowing spacing to develop between this
50 and the 20, further strengthening the
push on the move down for the semi. So,
the next area of support comes right
here on the 50% area of this parallel
channel, $532.08.
Any sort of near-term bounces that you
see after hours, we are lifting up off
of Dell, which we'll take a look at here
in a few moments. Resistance will be
right here on this declining trend line
near term at 558 and 2 cents. Now guys,
this is where the picture gets a little
bit more scary. Yesterday and today,
look at the 10-year yield daily pushes,
guys. Yesterday closed above this
consolidation, increasing probabilities
of a continued move higher, and that's
what we got today. We got as high as 4.8
%. In essence, kissing this 4.809%
level of resistance, which comes back to
the highs that occurred back here in
January of 2025. Now here, if you know
anything about simple moving averages,
and I'll give you a little bit of
insight, but this is where it gets a
little bit spooky when I see this on the
charts, guys. Whenever we have, and this
is the weekly time frame that I switched
to, so the moving averages are based off
of each weekly candle on the close. You
can see what's occurring over here on
the right-hand side of my chart. Yeah,
we've got a big bull flag consolidation
going on, but then now we are starting
to see the moving averages separate
themselves, creating strength and
support. Plus, they're all in the right
appropriate locations. The 20 on top of
the 50 on top of the 200. You can see
when that happens, guys, the price
action on any chart then is propelled to
go higher. Look at the spacing that's
involved whenever we start to go up on
charts. You can see we start having a
little bit of turmoil and sideways chop
right through here. And then when that
spacing starts developing, the higher
the move goes up on the chart. And
that's what's developing right now over
the past several weeks on the weekly
timeframe. Now we're into resistance. We
kissed it today. The next level will be
5% guys. So I anticipate if we remain
elevated, we likely will do so in
between 4.8 and 5%. Need to get over
that 4.809 and close first. But at least
what the weekly timeframe is showing me
is that the likelihood of this
continuing to stay up and elevated is
actually increasing with all of these
weeks staying up here in the 4.7%
range.
Interesting stuff, which is likely going
to put pressure on gold like we see here
on this chart. Now gold has had an
incredible three-day decline guys. We
see this also price action tagging and
piercing through support right now at
$4,333.
You can see this level of support is so
close to the bottom of this parallel.
This is in essence is a support zone
right here at $4,333
and the bottom end right down at the
bottom of the parallel $4,278. Right
here in this zone actually should put
the brakes on for gold selling in the
near term, which would make sense as
I've stated. We're into resistance.
We could very well start chopping
sideways. Maybe even have a couple more
day push up, which in case would allow
gold to hit the bottom of that parallel.
We then could chop on that 10-year
yield. And then I could see a potential
for gold at least maybe trailing the
bottom of this parallel or pushing back
up. Now flipping the moving averages on,
you can see here too. Gold in essence
was rejected by this 200 daily moving
average. We pierced above it and came
right back down 20, recaptured above,
which is not good, but at least we have
another level of potential support with
this 50 daily moving average coming in
right underneath this bottom of the
parallel channel. In essence, there's
now three levels of support right here
in this zone stretching down to $4,214
for at least a near-term pop. Now, if
the yields continue to press after that,
I anticipate gold to continue moving
down lower and very uh dangerously
potentially hit this declining trend
line. Now, 3,500 would be my ideal buy
zone as that returns all the way back to
the pivots back here in April of 2025.
Uncertain we get down there, but if it
does, guys, that is a buy zone if I've
ever seen one. Likely would be buying on
the way down sub $4,000 for gold to
eventually move up higher. Next up into
silver, also nasty decline that we see
here today. Mainly highlighting that the
other day how we were continually
hitting this level of support, which is
now resistance, likely weakening it,
increasing probabilities of a decline,
and that's what we've got with the next
level of support, this previous pivot on
July 6th at $63.26
could correspond, as I've said, with the
10-year yield calming out for at least a
little bit, providing the opportunity
for precious metals to start pushing up
on the charts with investors getting
back into it. Much like gold, we've got
the 50 daily moving average right
underneath this level of support. So,
even if we pierce it, we've got a decent
level of support that could keep price
on silver right at or slightly above the
$63.26
level. Uh next up into US oil, guys.
Look at this nice surge on oil of 5.2%
as I've said, escalation has increased
over in the Middle East, pushing through
this gap fill, likely finding some
resistance to settle out here through
the rest of the day. We've illustrated
this breakout very cleanly, very nice
declining trend line. Look at that
breakout, retrace to the scene of the
crime. Guys, again, we go over this
weekly here in this show because there's
opportunities like this
at nearly every day if you can find them
on the charts, you can make a boatload
of money with this one simple breakout
retrace pattern that is playing out
continuously till today. Now, let's flip
on a couple things. Notice that even
with technical analysis, we can have
parallels, trendlines overlapping. We
can have different signs of analysis,
near-term, longer-term, but look at this
parallel channel that I float over top
of this declining trendline illustrating
the near-term breakout. But then now,
guys, look, we're running right into
some additional resistance. But guys,
that makes sense. That's right here in
this high pivot range. It's just
technical analysis backing itself up for
this previous pivot. Likely should
experience some resistance coming into
this 91 to $94 range with these high
pivots and this declining parallel being
on that, we're targeting $96.44.
Look at the moving averages, and you can
see they too are starting to space out,
giving that strength, illustrating the
fact price is moving up on US oil like
that, all in their appropriate spaces.
Uh this is a healthy chart for at least
the near-term for potential movement to
the upside.
Next up, nat gas. I've been talking
about this too. Beautiful move higher,
breaking out and confirming the breakout
yesterday above this horizontal
trendline at $2.90.
This bull flag um uh
consolidation and break above is
continuing as we see step staircase step
one, staircase step two. We're looking
to start moving up higher in the next
couple days. I wouldn't even be
concerned with a couple more days of
consolidation. Look at these daily
candle wicks developing the last 3 days
showing investors are starting to get
excited to push nat gas up in value.
Next stop is going to be right about
here, $3.10. These low pivots as well as
the high pivots from May 26th. And then
we have the ultimate near-term
destination, this declining trend line
right around $3.25.
We flip on the moving averages and we
can cleanly see yesterday and really the
last four days have all closed above
this 50 daily moving average and
starting to get a little extension.
We'll see what we can have occur in the
coming days, put in more daily closes up
here in this range of $3 and $2.99.
Build more momentum to make the next
leap up another 10 cents on that chart.
Next up we've got Bitcoin. Look at
Bitcoin really not doing too much today,
down 1.57% near-term wise. Look at this
big red candle from August 28th. That is
bearish consolidation amongst larger
bullish consolidation. So I'm slightly
leaning Bitcoin could be coming in under
76,000 on the near-term, right around
$72,000
and 200 72,276
will be the next key level of support
that I'm going to be watching. But you
notice the moving averages are starting
to work in Bitcoin's favor, at least on
the daily time frame. 20 moving up
quickly, the 50 trying to cross back
over this 200. And by the time, if price
starts selling down, we could see the 50
right around 72,000 helping to support
price on the chart of Bitcoin. Next up
guys, a couple losers on the stock
market today. We've got Axon Enterprises
down 8.52%.
You may have heard of these folks
before. They do cover the body cameras
on police officers as well as I
potentially think security officers too,
but mainly known for those body cams.
And so, what do you do if you come to a
chart like this and there's nothing on
it, guys? There's, you know, you have a
couple ups and down moves. What do you
do to start analyzing the chart? Well,
one, as we've already touched on, we
could throw throw on the simple moving
averages and see that whoa, all right,
we've got potential support coming in
with the 200 daily moving average here
at $506, but what's happened in the last
couple days with price getting under
both the 20 and the 50 is not
necessarily that good. You can see it's
a failed near-term bull flag breakout.
So, we're starting to move down pretty
quickly. All right. Well, where can
price go if and when it gets through the
200 moving average? Well, then I just
simply go back further on the chart,
really get a good view as to what's
going on
on this chart. And if I go all the way
back and I start to realize, all right,
well, I can connect a couple different
levels here with trend lines. We go back
to the April 2020 COVID low, guys, and
we can see this comes in all the way
down here at $180.
Well, that seems a little bit too far.
That doesn't make too much sense. All
right, that could be a worst-case
scenario, right? Maybe Axon does not
become the number one police officer
support equipment, but this is more
realistic. Go to June of 2022, connect
this low pivot to low pivot, and then
now we have a secondary level of support
should and if this
200 moving average get overtaken by
price moving down lower. Now, you can
see how that lines up right here with
all the support at $400. It is a smooth
$100 lower, but it's certainly a
possibility for price to continue with
the failed breakout move at least in the
near term. Now, I flick it to the weekly
time frame, that 200 moving average
could provide some relief just a tad bit
sooner, but this is a really interesting
play, one of which that has been on the
verge of breaking down, trying to save
itself with an inverse head and
shoulders pattern, but at least in the
near term, that has moved to the
downside and failed on this chart. I'll
be looking for more support sub $450
on this chart of Axon in the near
future. Next up, into SAIE
or SAIA,
and another loser on the day as you can
see down 6.62%
and very much like the last chart, what
do you do in a situation where price
action is this low on the chart after
having been rejected from previous pivot
points? When we flip on our moving
averages, ooh, this does not look
pretty, guys. This is telling me that we
likely, with this daily close, are going
to be going lower. Look at that 200
moving average about to cross over the
50. This is a daily death cross at hand.
That is not that good, folks, for
current pieces of business on S A E, at
least for investors. Now, if we want to
draw another trend line, it's simply
this repetitive nature of this technical
analysis really helps you key in on all
sorts of charts on all sectors because
you can do the same thing on each chart.
Now, if I pull in a longer-term trend
line, this one happens to date back to
the COVID lows, connected over to these
pivots, and what do you see? A clear
area of major level of support. That's
going to be under $300 at $277.91.
This one makes ideal sense. We do have
price action looking like it's start to
flip to become bearish, could have some
heavy selling days bringing in this
level sooner rather than you anticipate.
And if we flip to the weekly time frame,
that's not looking that good, either.
So, the odds of S A I A moving up in the
near term are not looking that good with
the moving averages stacking against
them with the 50. Now, it's starting to
actually inch up towards that 200. That
this is just not that good of a looking
chart telling me price action
probabilities are likely coming down
lower before we're going higher. Now,
the opposite end of the spectrum, Dollar
General. Look at this great push today
up 3.42%
trying to clear these levels of
consolidation. First things first, need
to get that price action to close above
these pivots, namely this pivot just
from the other day with a high of
$132.50.
That really could start lifting up
Dollar General as you look at the moving
averages. They too are trying to support
a move up with this red 200 moving
average. Now being beaten 2 days in a
row, we'll see if we get that extension
to move out further. Now I move back on
the chart, you can see what two is
developing here. Left shoulder, head,
and a right shoulder with this being the
near term destination, which is the
neckline of the inverse head and
shoulders pattern at $153.78.
That's where price action's looking to
go if and when it can get through this
200 weekly moving average at $133.85.
It makes it even more important as I
described, get a close above these daily
candles, start establishing up in that
range, and then you'll get yourself on
this chart over that 200 weekly moving
average. See how you can just break
charts down from the daily expand back
out to the weekly, reconfirm your
thesis, and so 133 on DG is the level to
beat. Uh next up, Amazon. You can see
Amazon having a decent down day down
1.87% holding on with its fingernails to
grab to this 50% area of the parallel
channel. That's going to be the key
level to watch tomorrow. Do we put in
another close mainly underneath 255.71,
but secondly, do we put in a close under
the low of today? If we do so, this bear
flag would then trigger the break down
for further downward pressure on Amazon
with the next key level of support I'm
seeing with pivot low to pivot low
lining up right here around $238
on the chart. Last little quick look at
the simple moving averages. What saved
price today on Amazon? This nice blue 50
moving average helping to hold price up
at least for today. We'll see what that
brings for tomorrow, but very
interesting to see how this continues to
illuminate price action on the charts
when you just simply fold in some of
these simple indicators that are right
here on your very own screens. All
right, next up Dell. Nice down day
today, down 6.8%
namely because of investors fearful of
any sort of bad print on earnings, but
right now they don't need to worry about
that. Look at the post market hours
pushing price above today's trading
action up at 466. Now the key thing will
get will Dell open above these two
levels tomorrow. They they're being at
$460
and then secondly and most importantly
above 468. An open above 468 would open
room for price to move higher on that
chart. That's something bulls want to
see on this chart of Dell. Let's just
peek real quick to see how high price
did get in extended hours. We got all
the way up to 473.
So 473 would do the job, but we just
need to find ourselves back up there
tomorrow at the open which could help
Dell push up higher on the charts.
Lastly on these moving averages, really
nothing much to go on here particularly
with today's sell off extending under
the 50 mainly due to the
apprehension for moving into earnings.
Nothing much to report except for if
price opens above that declining trend
line 468. That'll be a big kick start
there for Dell to potentially move up
further on the charts. All right guys,
that wraps up today's trade and the
close. Lots of details we went through
today, so thank you for sticking
through. Thank you for learning about
these simple moving averages walking
through these small nuances that help
put probabilities on your side for your
next upcoming trade. All right guys,
don't forget to like and subscribe to
the video. Send this out to your friends
and family so they too can learn
technical analysis on the charts. We'll
see you next time tomorrow right here
and until then have a fantastic day and
we'll see you on the charts. Take care
folks.
>> Oh.