Trading The Close Market Recap - 10/28/2025: S&P Breakout, Tech Rally & Nuclear Hype Signal Pullback

The market continued its upward trajectory today, with the S&P 500 securing a technical breakout propelled by a surge in the technology sector. Major capital inflows made headlines, from NVIDIA's strategic $1 billion investment in Nokia to an $80 billion commitment by the U.S. and Japan to expand nuclear energy infrastructure. In this afternoon's Trading The Close show, Pro Trader Drew Dosek of Verified Investing dissected these powerful moves, revealing the nuanced technical signals that suggest a pause may be on the horizon, even as the rally continues.

Anatomy of a Breakout: Reading the Fine Print

On the surface, today’s market action was a clear win for the bulls. The S&P 500 followed through on yesterday’s breakout with a confirming move higher. However, as experienced traders know, the character of a move is just as important as its direction. Drew pointed out a subtle but critical detail in the S&P 500's daily candle.

"We're putting in a narrow body bar, much like how I described back here… with a narrow body bar and an extended push and breakout, that's likely telling us we're going to be coming in."

A narrow body bar, especially after a strong multi-day advance and a breakout, often signals a loss of momentum and indecision among market participants. It indicates that despite closing higher, the battle between buyers and sellers was much more balanced than on previous days. This type of price action can be a precursor to consolidation or a minor pullback, where the market digests its recent gains before attempting its next leg higher. This signal is amplified by the context of the upcoming Federal Open Market Committee (FOMC) announcement, which typically mutes trading activity as investors await guidance on monetary policy.

In contrast, the tech-heavy Nasdaq 100 (QQQ) displayed more conviction, closing stronger than the S&P 500 without forming a doji or narrow body candle. The QQQ has been on a tear, with four consecutive days of gapping up and closing higher. This pattern, while incredibly bullish, is not sustainable indefinitely. Drew identified a key resistance level on the horizon at 658.93, suggesting that a pullback to test the breakout support level around 612.69 would be a healthy development before a potential push to that target.

The Power of Parallels: Charting the Unseen Path

A recurring theme in today's analysis was the predictive power of parallel channels, a technical tool that can provide invaluable insight into support and resistance, especially when a stock is in "blue sky territory" or all-time highs. Drew demonstrated this masterfully with the charts for the semiconductor ETF (SMH) and SoFi.

For the SMH, which is also in the midst of a monumental push higher, Drew showcased an advanced technique of layering two parallel channels drawn from different timeframes. The shorter-term parallel showed a potential breakout, while a longer-term parallel, encompassing price action back to late 2021, provided a critical confluence. This longer-term channel precisely cut through the top of the recent consolidation, identifying a key support level at $347.59 should the market begin to correct. This layering technique offers a more robust and confirmed view of potential market structure.

SoFi provided another textbook example. After reporting strong earnings that beat estimates on both the top and bottom lines, the stock surged higher. But where did it stop? Precisely at the top of a parallel channel drawn from key pivots over the past year. As Drew explained, when a stock is at all-time highs with no prior price history to act as resistance, tools like parallel channels are essential.

"How are you going to pick resistance levels if you don't have previous gap fills, consolidation, price action, to give you insight as to where price could stop?… One way to find that is by drawing parallels."

The SoFi channel was validated by how price had previously respected its 50% midline, adding to its credibility. The top of this channel, at $31.92, now serves as the clear line in the sand for the stock, demonstrating how proper technical analysis can identify key inflection points with remarkable accuracy.

The Nuclear Renaissance: Hype vs. Reality

One of the day's biggest stories was the massive capital injection into the nuclear energy sector. An $80 billion deal between the U.S. and Japan to build new nuclear plants sent shares of Cameco (CCJ) soaring by an astonishing 23.42%. While the immediate price action reflects immense optimism about the future of nuclear power to fuel AI data centers, Drew provided a crucial dose of historical context and long-term caution.

He reminded viewers that in the entire 21st century, the United States has only completed three new nuclear power plants, and two of those projects went a staggering $20 billion over budget. This history of massive cost overruns and delays is a significant headwind that the current market euphoria may be overlooking.

"While it sounds fantastic right now, what's the reality going to be here in a couple years?… Right now, investors are piling in these AI data center plays, but the cost of which we don't really know what's going to happen at the very end when all the dust is settled."

This is a critical lesson in separating a short-term momentum trade from a long-term investment thesis. While traders can certainly capitalize on the current upward momentum, long-term investors must weigh the very real execution risk. From a technical standpoint, CCJ is now extremely overbought, with a weekly RSI above 83. For those looking to enter, chasing the stock at these levels is a high-risk proposition. A more prudent approach would be to wait for a pullback to a key support level, such as the long-term trendline around $88.20.

Navigating Runaway Trains and Red Flags

The theme of waiting for a disciplined entry rather than chasing a parabolic move was echoed in the analysis of Nokia. Following the news of a $1 billion investment from NVIDIA, Nokia stock surged over 22%. While a game-changing development for the company, such a massive one-day gap up creates a "runaway train" scenario. Drew identified the next major resistance at a long-term trendline from 2019, around $8.31. He advised that traders not already in the position should exercise patience and wait for the inevitable profit-taking to create a pullback, watching for potential support at levels like $7.20 and $6.59.

The analysis of viewer-submitted charts provided further valuable lessons. CleanSpark (CLSK), a Bitcoin miner and power sourcing company, has been on a massive 166% run. However, it recently hit a major trendline resistance from its 2021 highs and experienced a sharp 30% pullback. This illustrates the extreme volatility of such stocks and the importance of not buying at the peak of a move. A more strategic entry point would be in the support zone between $15.00 and $17.00.

In contrast, the analysis of BMNR, another Bitcoin miner, offered a different kind of lesson—how to spot a potential red flag. Drew pointed out the stock's history was littered with multiple reverse stock splits.

"Whenever a stock is littered with reverse stock splits, that's telling me they've got financial issues… There's too many other opportunities for me to jump into at the current moment. With that, I would be out of BMNR regardless of any potential of moving up."

This is a pearl of wisdom for all investors. While such a stock could turn around and produce massive gains, a history of reverse splits is often a sign of a company struggling to maintain its listing requirements and underlying financial health. In a market full of opportunities, it's often better to avoid such situations and focus on companies with stronger fundamentals.

Conclusion: Discipline in a Bullish Market

Today's market action was undeniably bullish, with tech leading the charge and major capital flows driving specific sectors to new heights. However, the deepest insights from today’s Trading The Close lie beneath the surface. The S&P 500's breakout is showing subtle signs of exhaustion ahead of the FOMC meeting. Parabolic moves in names like Cameco and Nokia, while exciting, are fraught with risk for those who chase them. And the power of sophisticated technical analysis, like layered parallel channels, provides a clear roadmap for navigating even the most volatile conditions.

The key takeaway is the paramount importance of discipline. The discipline to recognize when a rally might need to pause, the discipline to wait for a pullback to a defined support level instead of buying into euphoria, and the discipline to walk away from a stock with fundamental red flags, regardless of its short-term potential. As the market continues to navigate major news events and powerful trends, this patient, analytical approach will remain the cornerstone of consistent trading success.