My Trading Game Plan Revealed - 12/30/2025: S&P Weekly Trendline at Risk, Nasdaq 23,000 Breakdown Risk

As the market heads into the final trading sessions of the year, a deceptive quiet has settled over the indices. Volume is light, as expected between the holidays, but underlying currents suggest a potentially turbulent start to 2026. In this morning’s My Trading Game Plan, Gareth Soloway, Chief Market Strategist at Verified Investing, outlined the critical technical levels and macroeconomic risks that are shaping his bearish outlook for January. From decade-long trendlines on the verge of breaking to the psychology of a reversal in the silver market, the charts are telling a story that every serious investor needs to hear.

The Most Important Chart for the S&P 500

While the market's day-to-day action is muted, the bigger picture reveals significant tension. A down day yesterday, followed by a flat-to-lower open today, is unusual for a holiday week that typically has a neutral-to-upside bias. As Gareth notes, another down day would be a clear sign of underlying weakness before institutional volume even returns.

This short-term price action, however, pales in comparison to the story being told on the weekly chart. Gareth has repeatedly emphasized one specific chart as the most important guide for the S&P 500, and its message is becoming more urgent.

“If we flip over to the S&P and in fact we'll flip over to the weekly chart, it just continues and I've shown this a million times, but it is basically the most important chart for the S&P that I am watching or any traders should be watching. The reason again is this parallel happens to denote every major pivot high and low in the S&P since 2020, almost, you know, basically five years ago.”

This isn't just a random line on a chart; it's a five-year roadmap of market behavior. This parallel channel has precisely marked the major turning points for the market, acting as a ceiling during rallies and a floor during sell-offs. With the S&P 500 currently pressed up against the upper band of this channel, the historical precedent points overwhelmingly toward a significant pullback. This single chart is the foundation of Gareth's bearish thesis heading into January, suggesting that the path of least resistance is now to the downside.

A Tale of Two Indices: NASDAQ’s Warning Sign

While the S&P 500 is testing its long-term resistance, the tech-heavy NASDAQ Composite is flashing its own warning signals. The NASDAQ has failed to make a new high since October, a divergence that indicates the once-dominant tech trade is losing steam.

More concerning is a new trendline that has formed, connecting the key lows from the April tariff sell-off, the November pullback, and the recent December dip. This creates a three-hit, confirmed trendline that is now the market's most critical support level for the tech sector.

A break below the 23,000 level on the NASDAQ Composite would violate this trendline, likely triggering a cascade of sell orders. This is a pivotal level to watch in early 2026. While the market is quiet now, a move below this line could quickly usher in a period of intense volatility, confirming that leadership has rotated away from technology and that a broader market correction is underway.

The Dollar’s Decade-Long Trend Is on the Brink

One of the most compelling long-term charts Gareth analyzed is that of the US Dollar. While the narrative for most of the year has been about dollar weakness—and it is down 10% for the year—the bigger picture tells a different story. Since the 2008 financial crisis, the dollar has been in a massive, multi-year uptrend. Gareth’s thesis for 2026 is that this foundational trend is about to break.

The catalyst? A perceived erosion of the U.S. financial system's stability in the eyes of the world.

“My thesis for 2026 is this is going to break and the dollar will weaken. And again, what is going to be the culprit here is going to be kind of the degradation of the US financial system, at least the viewpoint from other countries that the US is the strong place to put their money.”

This isn't just a theoretical forecast; a classic technical pattern is forming that supports this view. The dollar chart is currently carving out a bear flag—a sharp down move followed by choppy, sideways consolidation. This pattern typically resolves with another significant move to the downside. A breakdown from this pattern and a violation of the 2008 uptrend would have massive implications, signaling a potential long-term tailwind for assets like precious metals and perhaps even Bitcoin.

A Black Swan Risk for 2026: The Bond Market

Compounding the risks is a developing situation in the bond market. Following recent social media posts from the President criticizing Fed Chair Jerome Powell, the 10-year yield has been inching higher. The logic here is counterintuitive but critically important for investors to understand.

One might assume that pressure on the Fed to be more dovish and cut rates would lead to lower bond yields. However, the opposite can occur. When the Fed's independence is publicly questioned, foreign investors who buy U.S. debt begin to demand a higher return to compensate for the increased political and fiscal risk.

“The more issues and in the independence of the Fed that gets lost… is that the investors that buy our long-end bonds, essentially the 10, the 20, the 30-year, they are going to demand higher interest rates. And that is going to be very problematic in the future.”

Gareth identifies this as one of his primary "Black Swan risks" for 2026: a scenario where the 10-year yield breaks out to the upside even as the Fed is lowering rates. Such an event would cause a major upheaval in the bond market, with ripple effects that could destabilize equity markets and the broader economy.

Patience and Precision: Trade Setups on the Radar

Amidst the bearish macro outlook, specific opportunities are beginning to emerge for disciplined traders. Gareth highlighted two stocks that are on his radar for potential swing trades in early January, both of which exemplify the importance of waiting for price to come to a predetermined level.

• NuScale Power Corporation (SMR): This nuclear energy stock has experienced a dramatic fall from a high of $57.00 USD down to its current price of around $14.67 USD. The chart is deeply oversold, but it’s not yet a buy. Gareth is patiently monitoring a major support zone between $13.40 USD and $11.50 USD. A dip into this area in early January could present a high-probability swing trade entry.
• Roblox (RBLX): Despite beating earnings and raising guidance, Roblox has sold off sharply due to concerns about margin compression—a theme Gareth believes will be critical in 2026. The stock is not yet at a buyable support level. The key level to watch is a former pivot high at $75.50 USD. This price represents a confluence of historical resistance that should now act as major support, offering a potential entry point about $6.00 USD lower than its current price.

Bitcoin’s Near-Term Pop vs. Long-Term Decline

The crypto market is presenting a nuanced picture. While Gareth remains bearish on Bitcoin over the medium-to-long term (6-12 months), with an eventual target around the $69,000-$70,000 USD level, his near-term outlook is decidedly bullish.

The chart is holding a pattern of higher lows and is forming a bullish inside bar pattern. This technical setup, combined with the potential end of year-end tax-loss selling from ETF investors, could create a "January effect" rally. Gareth is long Bitcoin with a target of $97,000 USD to $100,000 USD by the end of January. This presents a classic trader's scenario: playing a short-term bullish setup within a larger bearish framework.

The Psychology of a Reversal: A Lesson from Silver

The precious metals market, particularly silver, provided a masterclass in market psychology this week. After a weekend of what Gareth described as the most extreme bullishness he’s ever seen in his career, silver printed a "nasty reversal candle" yesterday—a bearish formation where the day's losses completely wiped out the prior gains after making both a higher high and a lower low.

Today, silver is bouncing, and many emotional traders are rushing back in.

“Psychologically, when you get a sharp pullback and you see it stabilize… is to buy the dip. That's human psychology. And that triggers these bounces… The only thing now that will change this chart back to bullish is if we can take out the high of this reversal candle.”

This is a critical lesson. A bounce does not negate a powerful bearish reversal signal. Until silver can reclaim the high of that candle near $84.00 USD an ounce, the chart remains technically bearish, and the bounce should be viewed as a potential opportunity to exit long positions or establish shorts. This is a perfect example of how contrarian thinking, guided by technical analysis, can protect a trader from emotional "buy the dip" traps. As Gareth often says, when the bagel guy is telling you to buy something, it’s time to be cautious.

Conclusion: Reading the Story the Charts Are Telling

As 2025 draws to a close, the market's low-volume churn masks significant underlying tensions. The S&P 500 is testing a five-year resistance line, the NASDAQ is clinging to critical trendline support, the US Dollar is threatening a decade-long breakdown, and a potential black swan is brewing in the bond market.

This is not a time for emotional, narrative-driven investing. It is a time for discipline, patience, and a deep respect for what the charts are telling us. By focusing on probability-based analysis, identifying key levels in advance, and understanding the psychological forces that drive markets, traders can navigate the potential volatility of early 2026 with clarity and confidence. The story for the new year is being written now, and for those who know how to read the language of the charts, it is a story filled with both risk and opportunity.