My Trading Game Plan Revealed - 10/15/2025: How To Trade Confirmation Signals For S&P, Nasdaq, Nvidia, Gold, Bitcoin

In this morning's My Trading Game Plan, Gareth Soloway, Chief Market Strategist at Verified Investing, cut through the noise of media narratives and social media hype to deliver a masterclass in pure technical analysis. The focus was on a critical, yet often overlooked, trading concept: the confirmation signal. As major indices and key stocks like Nvidia hover at pivotal trend lines, understanding the difference between a simple break and a confirmed breakdown is the key to navigating the market's next move.

The Confirmation Signal: A Trader's Gold Mine

In the world of trading, a line on a chart is not just a line; it’s a boundary of probabilities. When price crosses a significant trend line, the immediate reaction for many is to declare a breakdown or a breakout. However, as Gareth detailed this morning, that initial move can often be a trap. The real signal, the one that shifts probabilities decisively, is confirmation.

"This is not a confirmed breakdown. And this is very important because again, there's a lot of people that would think this is a breakdown in the charts and technically speaking, based purely on probability and the years or decades of study, I've found that it only slightly favors the downside when you close below a level… it's about the confirmation of that move."

So, what is confirmation? It’s a secondary signal that validates the initial break. For a breakdown, confirmation occurs when the price closes below the low of the candle that first broke the trend line. Until that happens, the initial break is merely a warning—a "yellow alert," in Gareth's terminology. A confirmed breakdown, however, is a "red alert," signaling that the probabilities have shifted dramatically to the downside.

This concept is not just theoretical; it has profound practical implications. As Gareth explained using the Natural Gas chart, traders who jumped the gun on a recent breakout—going long as price pierced resistance—were quickly punished when the move failed to confirm and reversed lower. Conversely, short-sellers who panicked and covered their positions on the initial break missed out on further gains. The confirmation signal is the filter that helps disciplined traders avoid these "whipsaw" moves designed to shake them out of sound positions.

S&P 500 and Nasdaq: Navigating the "Yellow Zone"

The confirmation principle is currently playing out in real-time on the charts of the major indices. Both the S&P 500 and the Nasdaq 100 have closed below their key multi-month ascending trend lines. For many, this is a bearish signal. For a seasoned technician, however, it is simply a "yellow alert."

The market remains in a state of flux, caught between two critical levels. For the S&P 500, the key levels to watch are:

• The Bullish Case: A recapture and close above the trend line, currently around 6,700. This would flash a "green flag," nullifying the breakdown signal and suggesting the uptrend can resume.
• The Bearish Case: A close below the recent low of 6,550. This would provide the confirmation signal, turning the yellow alert into a red alert and strongly suggesting a major market top is in place.

Until one of these events occurs, the market is in a neutral "yellow zone." This is a time for patience, not prediction. It’s a period where algorithms often try to force traders into making mistakes by creating false moves. The market's resilience yesterday, rallying back to green after an initial drop before a late-day selloff on a political tweet, shows the ongoing tug-of-war. The disciplined approach is to wait for the market to declare its direction with a confirmed signal.

ASML: A Lesson in Relative Strength and Gap Fills

While the indices are showing signs of caution, this morning’s earnings report from Dutch semiconductor giant ASML painted a picture of underlying strength. Despite warning about a significant hit from a slowdown in China, the company reaffirmed its full-year guidance. The market interpreted this as a sign of immense strength in their non-China business.

"In spite of China, they basically are saying that the rest of their business is very strong and able to make up for the shortfalls that the Chinese loss of revenue will be. And that's very important, folks, because again, the markets are saying, wow, things must be very good for ASML."

The stock gapped up on the news, but the most important technical feature on its chart now lies ahead. A massive gap from a July 16th selloff creates a powerful resistance zone. The top of this gap, known as the "gap fill," sits at approximately $1,071.

Gap fills are one of the most reliable concepts in technical analysis. When a stock makes a dramatic move, it leaves a void or "gap" on the chart. Price has a tendency, like a magnet, to eventually return to fill that void. For ASML, the $1,071 level represents a confluence of sellers who were trapped during the initial drop and will be looking to sell at their breakeven point. This makes it a high-probability target for a short trade, a level Gareth is watching closely for both day and swing trading opportunities.

Nvidia vs. Amazon: A Tale of Two Breakdowns

To see the confirmation signal in action, one need only compare the charts of Nvidia and Amazon. Nvidia, the market leader, has just closed below its critical uptrend line that started at the April 7th low. This is the first break of this trend, putting the stock squarely in the "yellow alert" zone. It is a caution sign, but it is not yet a confirmed breakdown.

Amazon, on the other hand, provides a glimpse into what could happen if Nvidia’s break confirms. Amazon broke a similar trend line weeks ago, and that break was subsequently confirmed. The result? The stock has been in a steady pattern of lower highs and lower lows, punctuated by weak bear flag patterns. While the broader market rallies, Amazon’s chart shows clear technical damage.

This comparison is crucial. It demonstrates that an unconfirmed break (Nvidia) is a time for observation and caution. A confirmed break (Amazon) is a signal for action and a change in bias. Traders should be watching Nvidia to see if it can recapture its trend line or if it follows Amazon's path by confirming its breakdown in the coming days.

Gold's Measured Move and the Psychology of a Top

Gold continues its powerhouse run, making another new all-time high today. After confirming a breakout above a key parallel channel, the question for technicians becomes, "What's the next target?" To answer this, Gareth introduced the concept of a "measured move," which relies on the principle of symmetry in markets.

By measuring the first major impulse wave up in 2025 and projecting that same distance from the start of the most recent leg up, a technical target emerges at $4,235. This method proved remarkably accurate in identifying the top of the 2024 rally.

However, with this strength comes a warning. The psychology of the market is shifting.

"It's gotten too lofty, too many weak hands, meaning that people are just chasing it because they think it's like a no-brainer money investment… once you get that mentality of like the gambler's mentality… That's where to me, at least it gets a little lofty and it needs to shake that mentality out."

This type of euphoric sentiment often precedes a significant pullback. History suggests a correction could be substantial. A similar pullback in the last rally was 9%. A 9% correction from current levels would bring gold back to around the $3,800 level. The likely scenario is that gold may test its measured move target near $4,235, then experience a healthy correction to shake out the latecomers before consolidating for its next major move higher.

Bitcoin: A Masterclass in Technical Precision

In a fascinating twist, Bitcoin is currently adhering to technical levels with more precision than gold, an asset traded for centuries. The chart is clean and the levels are clear. The most important level for bulls is the major ascending trend line, currently providing support around $110,000 USD.

This level has been tested multiple times and has held firm. However, should Bitcoin close below it and confirm that breakdown, the trap door could open for a swift move down to the next major support trendline, currently in the $93,000 to $94,000 USD range.

On the upside, if support holds, the path is clear for an eventual retest of the all-time high trend line, which now sits as resistance near $127,000 USD. The key for Bitcoin traders, just like with the stock indices, is to wait for confirmation. A break of $110,000 is a warning; a confirmed break is a signal to act.

Conclusion: Trading with Process Over Emotion

Today's market analysis underscores a timeless truth: successful trading is not about predicting the future or following the herd. It's about developing a disciplined process based on logic and probability. The confirmation signal is a cornerstone of such a process. It provides a filter against market noise, protects against emotional decision-making, and helps traders avoid the common traps that lead to losses.

By understanding when a market is in a "yellow zone" of caution versus a "red zone" of confirmed action, traders can improve their odds significantly. As Gareth noted, with dedicated study and emotional control, achieving a high win rate is not an outlandish goal. Whether analyzing indices, individual stocks, or cryptocurrencies, the principles remain the same: identify the key levels, wait for confirmation, and execute your plan with discipline.