GAME PLAN REVEALED: 05/22/2025

In this morning’s GAME PLAN show, Gareth Soloway, Chief Market Strategist at Verified Investing, drilled into the one factor currently driving market direction: yields. After yesterday’s surprisingly weak 20-year Treasury auction sent yields higher and equities lower, he emphasized the critical inverse relationship between bond yields and stock prices. Today’s article unpacks those dynamics, explores key technical setups across major indices and asset classes, and provides historical and psychological context to help traders navigate what comes next.

The Yield–Equity Inverse Relationship

"Yields go up, markets sell off. It's just that simple."

The most straightforward—and often most reliable—driver of equity swings in 2025 has been Treasury yields. Yesterday’s 20-year auction illustrated why. Although demand remains sturdy, the Treasury had to raise the coupon to attract buyers. That repricing rippled through the market, sending the 10-year yield spiking to a session high near 4.62%, triggering the S&P 500’s largest one-day drop in about a month.

Historical Context
Similar episodes have unfolded before. In 2013’s “Taper Tantrum,” then-Fed Chairman Ben Bernanke hinted at reducing asset purchases, and long-term yields leaped—sinking U.S. stocks and emerging-market assets. The key takeaway: when auctions or Fed communications surprise on the hawkish side, long yields often jump, and stocks must pause or reverse.

Technical Focus
On the daily 10-year Treasury chart, yields broke above a short-term downtrend and tested resistance near 4.62%. Gareth’s target remains 4.74%. If yields extend toward 4.74%, expect additional equity pressure; conversely, a pullback in yields would likely fuel a stock market rebound.

S&P 500 Technical Dynamics

"Remember, good technical traders don't go on opinions. They go on what the chart is showing us."

Even before yield moves roiled markets, the S&P 500 was flirting with key resistance. On recent intraday charts, the index formed a classic bull-flag consolidation: a strong rally off the April lows followed by a narrow trading range.

Bull Flag vs. Bear Flag

• Bull Flag: If the S&P holds its current range and then breaks higher, technicians will view this as a continuation pattern, projecting further upside.
• Bear Flag: However, a decisive break below today’s lows would shift the pattern’s bias, signaling a potential reversal and deeper pullback.

Historical Precedence
In late 2021, the S&P formed a similar bull flag after a sharp rally. When yields briefly spiked, the index dipped to its lower flag boundary before resuming its ascent to all-time highs. That episode underscores the importance of chart patterns: they remain valid until clearly invalidated, regardless of fundamental narratives.

Sector and Stock Spotlights

Snowflake (SNOW)

"If we were to get that high today, then I think the probability is strongly favoring a rejection or pullback off this level."

Snowflake gapped to $195 post-earnings, clearing its prior consolidation highs. Zooming out, a cluster of pivot highs defines resistance around the $210–211 area. Traders eyeing a short-term reversal will watch intraday tests of $210–211 for signs of selling pressure. A failure to sustain above that zone would likely trigger a pullback.

Urban Outfitters (URBN)

Urban Outfitters surged to $70.85—just above its long-term uptrend line. A tight cluster of trendlines converges near $70.71, marking a logical level for profit-taking if price cannot hold above. Any close at or below $70 would suggest a deeper pullback in the stock.

nPhase and Solar Stocks

nPhase plummeted from $47 to $37 on news that the House-passed energy bill would end 30% solar tax credits in 2025—a drop of about $10 and over 20%. Technically, the $37 pivot low creates a short-term support zone. If that level holds, contrarian buyers may step in for a bounce.

Policy Context
Solar companies have struggled against China’s low-cost photovoltaic manufacturing. The pending tax credit phase-out compounds margin pressures, making these levels crucial battlegrounds for bulls and bears.

Cryptocurrencies and Precious Metals

Bitcoin (BTC)

"I stick with what has worked in the past should work in the future until proven otherwise."

Bitcoin ripped out of a bull-flag consolidation, briefly eclipsing the double-top high of 109 000. The next major barrier lies at 113 000–114 000, defined by trendlines drawn from the 2017 peak through early-2021 highs. A parallel channel also points to 115 000 as an ultimate battleground between bulls and bears.

Gold and Silver

Gold continues its series of higher lows despite short-term chop. Resistance sits at $3 370–3 375, formed by a down-sloping pivot line. The longer-term uptrend remains intact as long as gold stays above its recent swing lows, suggesting that any dip is likely consolidation rather than a new downtrend.

Silver, after late-week longs, pulled back to test its rising trendline. That line—around $34.50—has held so far, keeping the uptrend alive. A sustained hold above $34.50 would keep further upside in play.

Palladium and Platinum

Palladium’s recent pullback is forming at its prior pivot high from November 2024, now serving as resistance. A break above that down-sloping line would offer a buy-the-dip entry, with a longer-term target toward $1 200–1 250. Platinum likewise looks poised for a fresh breakout once it clears its corresponding down-sloping trendline.

Commodities: Oil and Natural Gas

Crude Oil

After spiking on geopolitical worries, oil prices retraced recent gains. U.S. production remains robust, limiting the impact of external shocks. OPEC is reportedly considering another production increase to pressure higher-cost U.S. shale producers offline.

"If oil prices go up, the U.S. just pumps more oil."
This dynamic gives OPEC leverage: they can rig the global price to push higher-cost producers out of the market.

Natural Gas

Natural gas rallied sharply on Monday but has since consolidated. No new trades are recommended until a decisive break of either the upper or lower boundary of this range. Traders should note key pivot levels for potential entry or exit signals.

Conclusion: Watching Yields for Market Direction

As Gareth emphasized, the central question for stocks over the next few days is this: “If yields go up, markets are most likely going to continue to sell. If yields come down and pull back a little bit, we know the markets likely will go back up.” With the 10-year yield testing 4.62% and trending toward the 4.74% target, traders must remain nimble. A pullback in yields could fuel another rally toward fresh highs; a new spike could ignite a deeper selloff.

On a broader horizon—irrespective of short-term oscillations—Gareth remains cautious: “Regardless, whether it’s a month from now or three months from now, I still think we’re going to be in for another big nasty selloff in the markets.” For now, focus on yield levels and clear technical markers across equities, crypto, metals, and commodities. Let the charts guide probability-based decisions rather than gut feelings or headlines.