Stocks Recover as Treasury Yields Pause Ahead of Key Jobs Report

Stocks recovered from their intraday lows as technology led the buying, and rising Treasury yields finally paused. The opportunity now depends on whether that relief continues, with tomorrow’s jobs report testing the recovery and several breakouts still waiting for confirmation.

In One Minute

The recovery looks constructive, but the major stock indexes finished largely flat. Semiconductors gained more than 1%, while the probability of unchanged rates at the next Federal Reserve meeting increased to 76%. Tomorrow’s jobs report is the immediate catalyst: 90,000 jobs are expected, compared with 162,000 previously. Watch whether Treasury yields continue easing, stocks hold their support, and Bitcoin (BTC) clears resistance just above $89,000 before becoming more aggressive.

The Setup

Cooler Personal Consumption Expenditures inflation readings have given the market some relief. Strong jobs reports still leave room for the Fed to raise rates, but expectations now favor unchanged rates at the upcoming meeting, with a 76% probability. December expectations remain tilted toward a rate hike.

The bigger development is in the U.S. 10 Year Treasury Yield (US10Y). It reached 5.342%, its highest level since 2002, before reversing and forming a red daily candle. Declining candles have been scarce since September 3, so this pause matters.

The daily chart has a sleeper hold pattern, a three-factor reversal signal pointing toward a pause or pullback. A narrow candle body at the weekly close would strengthen that signal by putting the pattern on both time frames.

After the rapid advance into the 5.289% area, I’m looking for consolidation or a retreat that could reach 5.021%. It may not fall that far, but even a pause is giving stocks room to recover.

What Changed

The SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust (QQQ) finished largely flat, but their recovery from the lows was encouraging. SPY bounced from $760.40 support and left a long lower wick. The candle resembles a bottoming tail, although that pattern needs to form at the bottom of the chart to meet its full criteria. A similar candle previously preceded a gap higher and another rally.

Repeated bounces make $760.40 important. The recovery supports a possible near-term bottom, with $766.79 as tomorrow’s resistance. The Nasdaq Composite Index (IXIC) also recovered from its lows and continues holding above the declining trend line near its record highs. The breakout remains intact, but I want buyers to move price farther away from that line.

Today did not advance meaningfully beyond yesterday’s action. The first resistance is the record high pivot just above 27,200 points, followed by resistance just above 28,000 points. That higher area combines a round number with trend lines extending from the December 2024 and November 2021 highs through the more recent June highs.

Wells Fargo & Company (WFC) pierced a longer-term rising trend line after financial shares spent roughly one to two weeks under pressure from rising rates.

Its Relative Strength Index, or RSI, is 32.58, putting it close to oversold territory. That supports a possible technical bounce toward $83.54, the lower boundary of its previous consolidation.

But the support line has now been touched five times. Repeated tests weaken it, especially when they come closer together. I’m watching this as a possible bounce trade, with profits protected quickly if price turns lower again. Another test could start breaking that rising support.

The iShares Russell 2000 ETF (IWM), which includes many bank stocks, was also oversold near the bottom of its parallel channel. That helps explain why financial shares reaching longer-term support could produce a near-term rebound.

The VanEck Semiconductor ETF (SMH) gained more than 1%. After earlier rejections and declines back into older parallel channels, it is progressing into a breakout. SMH closed above the 0.618 Fibonacci retracement measured from its record high to the July low, clearing an area where it had consolidated for several sessions. Another close above today’s candle would strengthen the move and help turn resistance into support. The next target is $635.84.

Its weekly chart previously showed the same sleeper hold reversal pattern now appearing in Treasury yields. Micron Technology, Inc. (MU) helped drive the sector’s recovery. Its earnings reaction produced a modest gain rather than a breakdown, giving other semiconductor and AI shares room to rise.

The AI data center buildout has supported Micron’s rally this year. Rising memory prices have also pushed computer costs higher, something to consider heading into holiday purchases. The key horizontal reference remains $1,035.50, associated with the June peak area where several advances had stalled. Micron traded below it during the session but finished positive and near the upper end of its consolidation.

I’m watching the gap fill next, followed by the record high. Beyond those areas, the 50% midpoint of the rising parallel channel could become resistance. That line rises over time, so where Micron meets it depends on when price gets there. The stock remains constructive, with room to advance if buying momentum returns.

SanDisk Corporation (SNDK) has been consolidating around the neckline of an inverse head and shoulders pattern while investors waited for Micron’s earnings reaction. Price is maintaining above that neckline, keeping the bullish setup intact. The measured target is above $2,600, based on projecting the distance from the pattern’s lowest point to its neckline upward from the breakout. A rising parallel channel also places resistance in that area.

Accenture plc (ACN) beat expectations for earnings per share and revenue. Its guidance helped push the stock above $197.98, the neckline of an inverse head and shoulders pattern. The retreat toward the session’s lows makes confirmation important. I’d prefer another close above today’s breakout candle, followed by a pullback that holds support and turns higher again. For a more aggressive entry, the first Fibonacci support is $201.79. Price may never return to the $197.98 neckline. While it stays above that neckline, the pattern supports a potential move to $277.37.

Synopsys, Inc. (SNPS) jumped 12.78% after announcing a deal with OpenAI. Price briefly pierced a declining trend line drawn from July 2025 but closed below it, leaving the breakout unconfirmed. The daily RSI is 74.41. Above 70, buying is stretched, which makes a sustained breakout more difficult.

Two more days of gains could establish the breakout, but they would also leave price more extended. A later pullback toward the trend line could offer a test of former resistance as support. The weekly chart has room to rise, but I don’t want to chase a new long position with the daily RSI above 70.

TKO Group Holdings, Inc. (TKO), the company behind WWE, triggered a large head and shoulders pattern last week. This week’s action appears positioned to confirm the decline, with a measured target of $137. A bounce could develop around the $166 shelf and lead to a neckline retest. For a bearish trade, I’d prefer that rebound followed by renewed selling. A move above the neckline would be the point to exit.

U.S. Crude Oil (USOIL) rose modestly but stayed inside the previous three days’ trading range. Price recently approached the lower boundary of its parallel channel, which also lines up with a previous pivot high. Today moved oil away from that support. I’m watching whether tomorrow extends the recovery or returns price toward the lower channel boundary.

Natural Gas (NATGAS) extended its decline from the recent peak and put a candle below a horizontal level that previously capped prices. A similar sequence occurred on September 9, when price broke above that ceiling, retested it, and briefly traded beneath it. I remain bullish despite excess supply and inventory concerns. If selling continues, the rising trend line at $2.98 could provide a meaningful bounce.

Gold (XAUUSD) changed little but remains above its recent lows. That is a modest positive. I want to see whether consolidation develops over the next several sessions into a stronger base for upside. Silver (XAGUSD) looks weaker. It fell to a low and moved sideways without a meaningful rebound, leaving a bear flag structure. A head and shoulders pattern also targets the $53 range, supporting further downside over the near to medium term.

Digital Assets and Crypto

Bitcoin remains in bullish consolidation despite a large red candle within its sideways range. Price has cleared a horizontal resistance line that previously blocked advances and continues holding above it. That keeps the immediate structure constructive.

The next test is just above $89,000, at the neckline of the previous head and shoulders pattern on the weekly chart. Clearing that threshold would make me more bullish on Bitcoin and the broader crypto market. That confirmation has not happened yet. Holding above the recently cleared resistance is encouraging, but the weekly neckline remains the hurdle.

Why It Matters

The recovery is getting help from both easing pressure in Treasury yields and strength in semiconductors. Micron’s ability to avoid an earnings breakdown allowed related technology shares to move higher.

But the setups are uneven. Financial shares may offer temporary rebounds while their support weakens, silver still points lower, and Bitcoin needs another breakout. That makes confirmation and entry price more important than the strength of any single session.

Key Levels

For the broader market, SPY’s $760.40 support and the direction of Treasury yields remain central. Bitcoin’s separate confirmation point is resistance just above $89,000.

Bull Case

The recovery can build if yields continue pausing or pulling back and the major indexes extend their gains away from support. SMH needs another higher close, while Micron and SanDisk need to maintain their constructive consolidations.

Accenture’s stronger setup is another advance followed by a successful support retest. Synopsys has weekly upside room, but patience with an extended daily chart matters. Financial shares could rebound, natural gas could bounce at $2.98, and gold could develop a stronger base. Bitcoin becomes more convincing above its weekly neckline.

Bear Case

The risks remain visible beneath the recovery. Wells Fargo’s repeated support tests increase the chance of a break lower, while Synopsys has not confirmed its breakout and remains stretched.

Silver’s patterns favor the $53 area. TKO’s breakdown points toward $137, with a move above its neckline invalidating the bearish entry. Oil could return to channel support, and Bitcoin has yet to clear its main weekly resistance.

What to Watch Next

Tomorrow’s 8:30 AM jobs report is the immediate catalyst, with 90,000 jobs expected versus 162,000 previously. Consumer sentiment and additional services PMI readings follow next week.

On the charts, watch the weekly Treasury yield candle, another higher close in SMH, Accenture’s breakout confirmation, and whether Synopsys clears its declining trend line. Keep an eye on financial support tests, oil’s channel boundary, and Bitcoin’s weekly neckline.

Bottom Line

The main question is whether a pause in Treasury yields can give this stock recovery enough room to continue through tomorrow’s jobs report. Technology is leading, but the weaker charts and Bitcoin’s unfinished breakout still call for selective entries. Let price confirm the move before committing more.