Oil Surges, Gold Tests \$4,100, and the S&P 500 Faces a Key Breakout Level

My Trading Game Plan Revealed | October 12, 2026

The biggest lesson from Monday's market action is that a strong headline does not automatically create a strong trade. Oil is moving higher on renewed geopolitical concerns, gold is testing an important technical level, and the S&P 500 is approaching resistance near its all-time highs. Yet across these markets, Gareth Soloway's message remains consistent: the chart must confirm the move before traders can assign greater conviction to the setup.

During Monday's My Trading Game Plan show, Gareth Soloway, Chief Market Strategist at VerifiedInvesting.com, focused on the relationship between geopolitical risk, interest rate expectations, and the technical levels that could determine the market's next directional move. With the bond market closed for the holiday and major bank earnings approaching, the immediate challenge is separating short-term reactions from changes in market structure. Several important charts are approaching decision points, but not all of them have provided confirmation.

Oil's Geopolitical Rally Meets an Important Technical Test

Renewed tensions in the Middle East have pushed oil prices higher, with crude gaining approximately 2.3% following reports of attacks involving Houthi forces and a Saudi Arabian airport. The latest escalation has added a geopolitical risk premium to energy prices, complicating efforts to bring fuel costs lower. Gareth also discussed the Trump administration's reported efforts to increase diesel availability through an arrangement involving Russia, questioning whether the proposed supply would be meaningful relative to global energy consumption.

The more important question for traders is whether the geopolitical rally changes oil's underlying technical structure. Gareth identified \$88.75 as a significant support area, with price action remaining constructive while that level holds. The rising trendline connecting the lows from early September provides another important reference point. A sustained break beneath that trendline would weaken the bullish structure and shift the technical outlook toward the bearish side. Until then, the chart continues to support a neutral-to-higher bias, even if the initial catalyst is geopolitical rather than economic.

This is where headline-driven trading becomes dangerous. A sudden escalation can produce a sharp move in oil, but the size of the reaction does not determine whether the move will continue. The technical structure provides a more useful framework for assessing whether buyers remain in control. For Gareth, the key is not predicting the next geopolitical development. It is identifying the price level where the current market interpretation would need to change.

S&P 500: The 7,818 Level That Could Open the Door to 8,000

Despite strength in oil, S&P 500 futures have remained relatively resilient, trading near unchanged to slightly positive levels during the early session. The index is approaching an important resistance area around 7,818, corresponding to the August 13, 2026, all-time high identified in Gareth's analysis. This level represents the immediate technical hurdle separating the current consolidation from a potential continuation higher.

A confirmed daily close above 7,818 would strengthen the bullish case and bring the 8,000 area into focus as the next major upside objective. However, an intraday move through resistance without a sustained close would carry less weight, particularly if sellers quickly push the index back below the breakout level. Gareth's framework emphasizes confirmation because failed breakouts can leave traders positioned in the wrong direction just as momentum begins to reverse.

Beyond the immediate resistance level, Gareth highlighted a larger technical development that could become increasingly important into early 2027. Converging trendlines are gradually narrowing the S&P 500's neutral trading zone, reducing the space between the boundaries that define the broader bullish and bearish scenarios. If the current lines remain relevant, their projected intersection around January or February 2027 could force a more decisive technical resolution.

The convergence itself does not guarantee an explosive move or establish which direction the market will choose. What it does suggest is that the current neutral structure may become harder to maintain as the boundaries tighten. For longer-term traders, the important development will be whether price confirms a breakout above the upper boundary or loses the lower support structure. The chart is approaching a decision, but the market still needs to make it.

Gold's \$4,100 Support Test Reveals the Market's Inflation Concerns

One of the more interesting developments from Monday's session is the relationship between rising oil prices and weakness in precious metals. Gold and silver have faced selling pressure even though the Treasury market is closed, leaving traders without a fresh session of yield data to confirm the bond market's response. At first glance, that disconnect might appear unusual. Gareth's explanation focused on what investors expect yields to do when trading resumes.

Higher oil prices can contribute to inflation expectations, potentially putting upward pressure on Treasury yields. Because gold does not generate interest income, rising yields can increase the opportunity cost of holding the metal, although real yields, the dollar, and risk sentiment also influence its direction. The market may therefore be anticipating a higher-yield environment before the bond market has reopened. That interpretation helps explain why gold can weaken even without an immediate move in the 10-year Treasury yield.

Technically, gold is testing a significant support area near \$4,100. A confirmed daily close below that level would weaken the near-term structure and bring \$3,950 into focus as the first downside objective. Gareth also identified \$3,500 as a broader potential target if a more substantial correction develops. On the upside, a descending resistance trendline remains an obstacle. A confirmed break above that structure would improve the bullish outlook and could bring the \$4,450 area into consideration.

Silver is experiencing more modest weakness after recovering an important support area during Friday's session. For both metals, the next meaningful test comes when the Treasury market reopens and traders can evaluate whether actual yield movements support the inflation expectations currently influencing prices. If yields fail to rise despite stronger oil, the relationship between precious metals and the bond market could become particularly important. The confirmation matters more than the assumption.

Treasury Yields: A Bearish Technical Signal Beneath Inflation Fears

Although the 10-year Treasury yield is not trading during Monday's holiday session, last week's candlestick structure provides an important counterpoint to the inflation narrative. Gareth identified a major weekly pivot area extending back to the 2007 highs, with yields approaching resistance that has historical significance. The reaction around this area becomes especially interesting when viewed alongside the recent daily and weekly candlestick formations.

The daily chart formed a topping tail on Wednesday, followed by another topping tail on the weekly chart that closed Friday. These formations indicate that yields moved higher during their respective periods but failed to sustain those advances, suggesting selling pressure in yields near resistance. When rejection patterns appear across multiple timeframes, they can strengthen the technical case for a potential reversal, although the patterns alone do not establish a guaranteed outcome or a specific statistical probability.

This creates a divergence worth following. Rising oil prices are encouraging expectations of higher inflation and potentially higher yields, while the Treasury yield chart is showing signs of rejection near major resistance. If yields begin moving lower when trading resumes, that would support Gareth's technical interpretation and potentially relieve some pressure on precious metals. If yields instead break above resistance and sustain the move, the bearish reversal setup would weaken. The next session should help determine which signal carries more weight.

Bank Earnings: Oversold Bounces Do Not Eliminate Longer-Term Risk

The start of major bank earnings introduces another test for traders, with JPMorgan, Goldman Sachs, Wells Fargo, and Citigroup among the institutions scheduled to report Tuesday, followed by Bank of America and Morgan Stanley on Wednesday. Gareth's analysis focused on the possibility that recent selling has created short-term technical opportunities, even as the broader economic environment presents longer-term challenges for financial institutions.

Bank of America (BAC) has pulled back into an oversold technical condition while filling a downside price gap. That combination can create the conditions for a rebound, particularly when selling becomes extended ahead of a major catalyst. Gareth identified the 50% Fibonacci retracement near \$58.80, within the broader \$58 to \$59 area, as an important potential resistance zone. A bounce toward that level would not necessarily indicate a renewed long-term uptrend. It could simply represent a recovery within a larger corrective structure.

JPMorgan (JPM) is showing a related setup after declining toward an area of historical support defined by previous pivot lows. That support may attract buyers looking for a short-term reaction, but earnings can quickly change the technical picture through price gaps and volatility. For both banks, the distinction between a support bounce and a confirmed trend reversal is essential. An oversold reading identifies a condition, not an automatic buy signal.

Gareth also emphasized the longer-term risks facing banks if elevated borrowing costs continue to weigh on loan demand and credit quality. Higher interest rates can benefit net interest income under certain conditions, but those benefits may be offset by weaker borrowing activity, funding costs, and rising credit losses. This creates a situation where short-term technical strength and a cautious longer-term fundamental outlook can coexist. Traders evaluating a bounce need to recognize that the time horizon of the setup matters as much as the direction.

Semiconductors: Why No Trade Can Be the Right Trade

Semiconductor earnings later in the week will provide additional information about technology sector strength, with ASML scheduled for Wednesday and Taiwan Semiconductor scheduled for Thursday. Gareth's technical analysis highlighted two different chart conditions, neither of which justified forcing a position simply because the companies are important to the broader market.

ASML remains between support near \$1,570 and resistance around \$1,870. The stock has struggled to establish a sustained breakout above its previous highs, leaving the current consolidation open to multiple interpretations. One possibility is that the structure develops into a larger bear flag, which would increase downside concerns if support eventually breaks. However, without a confirmed resolution, the stock remains in what Gareth described as no-man's land. The chart has boundaries, but it has not yet provided a compelling directional signal.

Taiwan Semiconductor is approaching a more defined technical support area near \$435, where a previous gap fill and historical pivot levels converge. That combination makes the area worth evaluating for a potential reaction, but price still needs to demonstrate that buyers are defending it. A support level can establish where a setup becomes interesting without establishing that the trade is ready.

The broader lesson is central to Gareth's trading philosophy. A professional trader does not need an opinion on every chart, and an active earnings calendar does not create an obligation to trade. When the technical evidence is mixed or the available reward does not adequately compensate for the risk, remaining on the sidelines can be a deliberate decision. Patience is not a lack of conviction. It is part of maintaining standards for trade selection.

Bitcoin: The \$81,000 to \$87,200 Range Defines the Setup

Bitcoin continues to trade within a broad consolidation, with Gareth identifying \$81,000 as major support and \$87,200 as the resistance level that needs to break for the bullish case to improve. Although Bitcoin has shown some early weakness, the larger technical picture remains defined by these boundaries rather than the smaller moves occurring between them.

A confirmed breakout above \$87,200 would improve the bullish structure and bring the \$95,000 to \$97,000 target zone into focus based on Gareth's measured-move analysis. Conversely, a sustained breakdown beneath \$81,000 would weaken the range and raise the possibility of a decline toward \$75,000. These are conditional scenarios, not predetermined outcomes. Until price moves decisively beyond one of the boundaries, Bitcoin remains range-bound.

The most difficult area for inexperienced traders is often the middle of the range. Price can move sharply in either direction without establishing a sustainable trend, encouraging repeated entries and exits that become costly through losses, spreads, fees, and potentially leverage. Gareth's warning was directed at the temptation to anticipate a breakout before the chart confirms one. Traders who repeatedly chase movement inside consolidation can find themselves reacting to volatility rather than executing a defined plan.

The stronger approach is to recognize where the technical edge may improve. A reaction near established support, a confirmed resistance breakout, or a breakdown followed by acceptance below support provides a clearer framework than taking a position in the middle of an unresolved range. Bitcoin does not need to produce a trade today for the chart analysis to be useful. Knowing where the next meaningful decision may occur is already valuable.

The Real Trading Edge: Selectivity Over Activity

Across equities, commodities, bonds, and cryptocurrencies, Gareth returned to the same principle: a trade should offer a meaningful edge before capital is committed. His preference is to identify setups where technical evidence supports a favorable outcome rather than accepting a roughly even directional proposition simply because the market is moving.

Gareth described looking for setups he assesses as having approximately 70% to 75% odds of success. Those figures represent his trading framework and judgment, not an independently established win rate for the patterns discussed. Actual trading outcomes depend on entry price, risk management, position sizing, execution costs, and market conditions. A favorable-looking chart is not enough by itself, and even a strategy with a relatively high win rate can lose money if losses are substantially larger than gains.

He also explained how selective this process can be. Out of 100 charts reviewed, only a small number may present setups that meet his standards at a given time. That is not a reason to lower the threshold or search for additional trades. It is a reminder that opportunity and activity are not the same thing. The objective is to identify the conditions where the chart, the risk, and the potential reward justify taking a position.

Bottom Line: Let the Levels Confirm the Next Move

Monday's market provides several important technical reference points, but the strongest opportunities may depend on what happens after the initial reactions. Oil needs to defend its support structure, the S&P 500 needs a confirmed close above 7,818 to strengthen the case for 8,000, and gold must hold \$4,100 to avoid opening a deeper downside scenario. The reopening of the Treasury market will also help clarify whether the inflation expectations influencing precious metals are supported by actual yield movements.

Bank earnings and semiconductor results will add another layer of volatility, while Bitcoin remains caught between \$81,000 support and \$87,200 resistance. None of these developments requires traders to predict the outcome before it occurs. Gareth's framework is built around identifying where the market has an opportunity to confirm or invalidate a setup, then evaluating whether the available risk and reward justify action.

The takeaway is straightforward: the market can present important levels without presenting an immediate trade. The edge comes from recognizing the difference.

Disclaimer: Trading and investing involve substantial risk, including the possible loss of principal. This article is provided for educational and informational purposes only and does not constitute financial advice or a recommendation to buy or sell any security or financial instrument. Technical analysis identifies possible scenarios, not guaranteed outcomes. Always conduct your own research and consider your financial circumstances and risk tolerance before making investment decisions.