Gareth Soloway argues the CPI and jobs data were slightly better than expected, but the market is rejecting the optimistic narrative and breaking down technically across major indexes. He frames the move as a distribution/rounded-top process rather than an immediate crash, then walks through tradeable levels in several stocks and markets.
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Gareth Soloway opens by saying he had predicted CPI would come in one-tenth better than expected, and the data did in fact print slightly softer than forecast. He argues that the market is not celebrating the report because Treasury yields are collapsing, which in his view signals skepticism about the strength of the economy and suggests the jobs data was also weak. From there, he shifts into chart-based analysis, saying the S&P, Nasdaq, and Dow have already broken key trend support and are now in a distribution phase. He characterizes the setup as a rounded top and possibly a head-and-shoulders pattern on the S&P, with a daily close below roughly 6790 as the key breakdown level. He then extends the same bearish framework to the Nasdaq and the Dow, emphasizing that bear markets tend to stair-step lower rather than crash immediately from highs because retail keeps buying dips. …
Near term, the actionable risk is continued weakness in the S&P/Nasdaq if breakdown levels keep failing to recover; a brief CPI bounce does not change his view. The main tactical edge is fading failed rallies and watching the cited levels, but sharp squeezes remain a real risk in beaten-down names.
Over the next several weeks, he expects equities to grind lower in a stair-step fashion unless major indexes reclaim lost support and reverse the pattern of lower highs. A sustained bounce in yields or a clean recovery above broken trend lines would force him to reconsider.
Structurally, the transcript argues that market regimes are driven by supply, demand, and crowd psychology more than narratives, with technical breakdowns often revealing the real underlying shift. The lasting implication is that failed breakouts and distribution patterns can matter more than headline economic surprises.
CPI came in one-tenth better than expected, matching his prior call.
He says he predicted CPI would be one-tenth better and that it printed 2% month over month versus 3% forecast and 2.4% year over year versus 2.5%.
The market does not believe the economy is improving because Treasury yields are collapsing.
He interprets falling yields as the market rejecting the positive economic narrative from jobs data.
The S&P, Nasdaq, and Dow have moved into breakdown or distribution mode.
He says the major indexes broke trend support and are now chopping lower rather than continuing higher.
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