CPI inks the rate hike, oil drops, yields stall — and the market rallies anyway.
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CPI came in fractionally hotter and hike odds jumped to 86.7%. That should have been bad news. Instead the S&P is up 1%, erasing yesterday's drop and then some, because oil is finally falling and taking yields with it. Gareth Soloway explains why a locked-in hike is bullish, and hands out the levels.
📐 TODAY'S GAME PLAN
🔴 THE CPI PRINT — Headline year over year in line at 3.4%, core year over year in line at 2.4%, month over month in line at 0.4%. The one miss was core month over month at 0.3% against 0.2% expected. Fractionally hot, and enough.
🔴 THE FED IS LOCKED IN — Hike odds went from roughly 70% yesterday to 86.7% today. Gareth calls it essentially a lock: the market expects it, and the Fed will not shake the ground by surprising anyone, rage posts notwithstanding. The real event is Warsh's press conference — whether he signals more hikes is what actually moves markets.
🟢 WHY STOCKS RALLIED — Because the hike was already paid for through higher yields, and the market reads it as one and done. With oil dropping overnight, futures ripped. Certainty is worth more than good news.
🟢 THE BULL FLAG HELD — Gareth called this exact structure: a descending channel drawn high pivot to high pivot and low pivot to low pivot, landing right on the bullish-bias trend line. Yesterday it tested that line and held. He also said on camera yesterday that he would be buying — and he did, in the Smart Money Stocks and ETFs portfolio, which is up on it today.
🟢 OIL — The call of the week, and it is fact-checkable. Yesterday Gareth said $104 was the next technical level. After the close, crude spiked to exactly $104, tagged the pivot, and reversed. It is now below $99, down 5%. He expects a pullback to $92.50 by early next week, where old resistance should become support.
🔴 THE INFLATION PICTURE — Perspective on the move: oil is up roughly 40% from the low a month ago, and about 30% in two weeks. Diesel is at all-time highs above $6 a gallon. If crude keeps mitigating, the whole inflation picture eases — which is why the oil chart matters more than the CPI print.
🔵 ORACLE — Numbers after the bell were very good, but the stock is only recovering a little more than it lost yesterday. Mid-range makes it hard to day trade. If it somehow rallies 10% to $179 he is a buyer; if it sells off, $139 to $140 is short-term support.
🟢 ADOBE — The teaching chart. It broke out over a major trend line, and broken resistance wants a retrace back to the scene of the crime to become support. That is around $220, roughly $20 below price. Gareth wants it as a swing trade, not a day trade, over the next week or two.
🟢 KWEB — The same setup, already completed. The China internet ETF broke out, retraced, and dropped right into the level yesterday before bouncing today. Support at $24.50, and he says he is getting more and more bullish on it as a swing.
🟢 GOLD, SILVER, BITCOIN — All three rescued by falling yields and a softer dollar. Gold's head and shoulders was teasing a breakdown and the bulls held the line he flagged yesterday. Silver tried the neckline, held, and is bid — break the trend line and it is $55, hold it and he sees $70 to $71. Bitcoin is bouncing off the zone near $76,000, which as long as it holds looks like a bull flag. Nat gas stays neutral.
🔑 KEY TAKEAWAY: The market did not rally despite the hike, it rallied because of it. Uncertainty was the tax, and CPI removed it. Everything else follows one chart — if crude keeps sliding toward $92.50, yields ease, the metals get their bid back, and the Fed's job gets easier. Watch oil, not the Fed.
⏱ TIMESTAMPS (estimated)
00:00 CPI Comes In Fractionally Hotter
01:20 Hike Odds Jump to 86.7%
02:30 S&P Futures Rally 1% Anyway
03:30 The Bull Flag That Held
04:15 Why September 11 Is Usually a Green Day
05:30 Yields Fall as Oil Drops
06:00 Oil Tagged $104 Exactly
07:45 Diesel Above $6 and the 40% Move
09:00 Oracle After Earnings
10:20 Adobe: Back to the Scene of the Crime
12:30 KWeb, Gold, Silver and Bitcoin
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💬 COMMENT: Is it one and done, or does Warsh signal more?
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⚠️ Educational and informational only — not financial advice. Gareth Soloway and Verified Investing are not registered investment advisors. Trading involves substantial risk of loss. Past performance does not indicate future results.
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