Gareth Soloway argues that hotter-than-expected CPI, rising oil, and a weakening semiconductor tape are starting to expose a crowded tech trade. He thinks institutions may be shifting the narrative as they distribute positions, while most of his actionable focus remains on chart levels across S&P, Nasdaq, SOXX, Micron, Intel, oil, gold, silver, Bitcoin, and a few high-volatility names.
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This was a solo market update from Gareth Soloway, chief market strategist at Verified Investing, centered on the day’s CPI print, rising inflation expectations, and how those inputs are affecting equities, rates, oil, and several high-beta trade setups. He opened by saying CPI came in hotter than expected, especially on the year-over-year and core measures, and tied that to the prior month’s surge in oil prices. Despite the inflation read, he noted that futures were not collapsing because the market had apparently feared an even worse number, but he still expected a lower open. A major theme was that large-cap tech and semiconductors may be entering a fragile phase after an extreme run. He said the Nasdaq had tagged a long-term trend line and that semis had moved so far so fast that the move was not normal, especially in SOXX and individual names like Micron and Intel. …
Tactically, the setup looks fragile for high-beta tech and semis if CPI-led rate pressure keeps lifting yields and the current trend lines fail. Near term, the main risk is a quick pullback in Nasdaq leadership while oil and inflation keep tightening the backdrop.
Over the next few weeks, the burden of proof is on semis and the Nasdaq to hold their recent breakout areas; if they cannot, a deeper retracement toward fib and gap-fill supports becomes the base case. If yields stay elevated and oil remains firm, the narrative shifts from breakout to digestion or reversal.
Structurally, he is describing a late-cycle market where prolonged asset inflation, narrative excess, and institutional distribution can precede a regime change. His long-term implication is that technicals matter because late-cycle markets often end with overshoot, then a much larger correction rather than a tidy pause.
CPI came in hotter than expected, especially on year-over-year and core measures.
He cites CPI 0.6% month-over-month in line, but 3.8% YoY vs 3.7% expected, and core hotter than expected.
The market is partly stabilizing because investors feared an even worse inflation print than the one released.
He explicitly says futures caught a bid because people expected worse than a one-tenth miss.
The Nasdaq is showing the first real weakness after a huge run and may be reacting at a major trend-line touch.
He points to a 2024/2025 trend line tagged yesterday and says the index is seeing downside weakness today.
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