GAME PLAN REVEALED: Cycle Risks, Key Index Resistances & Bond Auction

Monday’s opening bell brought a fresh burst of optimism. Friday’s stronger-than-expected May nonfarm payroll report sent equities higher, momentarily silencing doubts about a slowing labor market. But beneath the headline lie weakening participation rates and downward revisions—metrics the market is willfully ignoring in its quest for a narrative of sustained strength. This week, beyond inflation data, all eyes turn to Thursday’s $22 billion 30-year Treasury auction, where bid–to-cover and yield levels could reignite volatility. Meanwhile, our mid-month cycle date looms, raising the specter of an all-time-high “rug pull.” Today’s article peels back the layers on these developments and the key technicals across indices, stocks, and commodities to help traders navigate the next few sessions.

1. Jobs Data Rally vs. Labor Market Reality

“If you look at participation rate, if you look at revisions from the previous months, I think the smarter ones of us know that the labor market is slowing down. But the markets… care about the headline number.”

Friday’s nonfarm payrolls came in stronger than expected, delighting investors who promptly wiped away underlying weakness. History reminds us that markets pivot on perception as much as reality. Participants are erring on the side of optimism, even as participation rates drift lower and past-month figures are revised downward. Acknowledging this bias helps us trade what is, not what we wish it to be.

Psychological takeaway: groupthink around headlines breeds momentum. When a data point suits the prevailing narrative, markets amplify it—sometimes overlooking cracks below the surface.

2. Chasing All-Time Highs Into the Mid-Month Cycle

“We’re about 2.4% away from that all-time high. I’m watching very closely to see—do they push markets up to all-time highs just into that cycle and make it a rug-pull?”

Cycle analysis often flags turning points when sentiment peaks. Our mid-month cycle—due about June 16th—could coincide with a push above the S&P 500’s all-time high. Stops and weak-handed longs piled above prior highs would be run, only to exacerbate selling when the rug is yanked. Markets thrive on extremes: April’s panic bottom marked an exhaustive selloff; the opposite extreme—extreme greed—often marks major peaks.

Historical example: In February 2020, the S&P pierced all-time highs before a swift crash. Similarly, autumn 2007’s cycle saw new highs in October, then the Great Financial Crisis unfolded. Trading around cycle turns means respecting the risk of reversals amid euphoric breakouts.

3. Key Index Levels: S&P 500, NASDAQ, Dollar, and Yields

S&P 500: Resistance at 6,020 and All-Time High

The Friday high stalled at ~6,020, a minor pivot from last distribution. Watch for spikes above ~$6,040—near the trend-line connecting prior highs—and for a decisive break of all-time highs. Failed breakouts often trigger sharp pullbacks as stop-hunters exit.

NASDAQ Composite: Descending Trend-Line

A short-term resistance line links the February high with previous pivots just below $20,000. Each test has stalled rallies, keeping the composite neutral despite broader strength. A clear breakthrough would signal renewed tech leadership; rejection points to rotation.

U.S. Dollar (DXY): Bear-Flag in the Making

A parallel channel off the April decline outlines a classic bear-flag: sharp drop, consolidated chop, then likely resolution lower. As long as DXY trades inside this channel, expect a downward bias that could boost commodities once confirmed.

10-Year Treasury Yield: Pivot Levels

Yields rallied on Friday’s jobs strength, marking a zone of swing pivots. While headline thinking argues for higher-for-longer policy, weak demand at Thursday’s 30-year auction could push yields lower as the Treasury tempts buyers with richer coupons.

4. Hyped Rallies and FOMO: The Robinhood Case Study

“Charts don’t lie. They don’t have agendas. The chart is what it is.”

Robinhood surged roughly 165% since April on rumors of S&P 500 inclusion. Investors front-ran the anticipated index add, only to see a 5% drop after Friday’s official exclusion. Technically:

A high-pivot trend-line from 2023 through February 2025 marked stiff resistance
Parabolic gains pushed RSI deep into overbought territory
No multi-factor confluence supported further upside

Mall analogy: you wouldn’t pay 3× your favorite jeans’ price just because everyone else is buying. Recognizing FOMO and sticking to technical truth prevents painful chase entries.

5. Tech, Industrials, and Spec Name Setups

GE Aerospace: A Run Echoing 1994–2000

Weekly and monthly RSI show negative divergence alongside a rising trend-line reminiscent of the dot-com era bull. On monthly charts, bear-ish divergence often signals a longer-term top. Consider partial profit-taking or tightening stops.

NVIDIA: Resistance at ~$49

NVIDIA battled a short-term ceiling near $49. A failed breach would suggest a pullback; a clear breakout sets the stage for further gains. Trade volume-backed moves and watch for gap fills.

Supercomputer and Aviation Names

Joby Aviation, Archer Aviation, and IonQ all gapped into resistance. IonQ, in particular, topped around $49 before rolling over—highlighting the “scene of the crime” retracement setup. Traders considering entries after such moves should wait for clear pullbacks, then look to fade rallies into prior breakpoints.

Tesla: Watch April Lows and $250

Pre-market weakness amid social-media skirmishes has Tesla testing support at last April’s lows. A break would open a slide toward roughly $250. News risk remains elevated; trade with defined stops.

6. Commodities Watch

Bitcoin: Testing $112,500 Resistance

Bitcoin’s rally mirrored equities. Resistance around $112,500 aligns with prior highs. On a pullback, watch technical support zones for entry opportunities.

Gold & Silver: Divergent Paths

Gold retraced to its swing-low trend-line, trading flat. Silver continues to press higher, eyeing a target near $37.60—roughly another $1.30 of upside. Silver’s industrial link may benefit from a softer dollar.

Palladium: Breakout and Retrace

Palladium punched above a long-term resistance line, then retraced to the breakout zone—a textbook “scene of the crime” entry. Look for confirmation on renewed buying to signal further gains.

Oil & Natural Gas: Bide Your Time

Crude drifts toward a key pivot. A rejection could rekindle the downtrend that began in March. Natural gas remains range-bound—no clear trade until resolution.

Conclusion: Trade the Charts, Not the Hype

This week’s roadmap hinges on three pillars: 1) the $22 billion 30-year auction, 2) mid-month cycle dynamics, and 3) inflation updates. Equities flirt with all-time highs, but cycle turns and overbought signals warn of a possible reversal. In stocks like Robinhood and GE Aerospace, hype-driven rallies clash with stark technical resistance. Across commodities and bonds, parallel channels and retracement levels guide entries and exits.

Always remember Gareth’s mantra: “Trade the charts, not the FOMO, not the fear, not the greed.” Defined levels, multi-factor confirmation, and psychological discipline form the bedrock of sustainable trading. As summer earnings slow, let your charts speak—for they don’t lie.