Directional Bias For The Day:

• S&P Futures are higher;
• The odds are for an up day with high volatility; good chance of sideways to down move from pre-open levels around 3795.00 – watch for a break below 3781.00 and break above 3804.00 for clarity
• Key economic data report due during the day:
  • IBD/TIPP Economic Optimism ( 51.0 est.; prev. 50.1)

Directional Bias Before Open:

Key Levels:

• Critical support levels for S&P 500 are 3784.32, 3769.40, and 3733.82
• Critical resistance levels for S&P 500 are 3808.61, 3830.50, and 3848.05
• Key levels for E-mini futures: break above 3804.00, the high of 5:45 AM and break below 3781.00, the low of 2:15 AM

Pre-Open

• On Monday at 4:00 PM, S&P futures (March 2021) closed at 3764.75 and the index closed at 3773.86 – a spread of about -9.00 points; futures closed at 3765.75 for the day; the fair value is -1.00
• Pre-NYSE session open, futures are higher – at 8:30 AM, S&P 500 futures were up by +30.25; Dow by +232, and NASDAQ by +104.25

Markets Around The World

• Markets in the East closed higher
• European markets are higher
• Currencies (from two weeks ago):
  

  Up	Down
  Dollar index USD/JPY USD/CHF USD/CAD INR/USD	EUR/USD GBP/USD AUD/USD NZD/USD

• Commodities (from two weeks ago):
  • Energy futures are higher
  • Precious metals are higher
  • Industrial metals are mixed
  • Most soft commodities are mostly higher
• Treasuries (from two weeks ago)
  • 10-years yield closed at 1.13%, up 1.6 BP from two weeks ago;
  • 30-years is at 1.887%, up 3.4 BP;
  • 2-years yield is at 0.121%, down 0.8 BP;
  • The 10-Year-&-2-Year spread is at 0.992, down from 0.968
• VIX
  • At 27.51 @ 8:00 AM; down from the last close; below 5-day SMA;
  • Recent high =  37.51 on January 29; low =  21.09 on January 21
  • Sentiment: Risk-On

The trend and patterns on various time frames for S&P 500:

Previous Session

Major U.S. indices closed higher on Monday, February 1 in lower volume. Major indices opened higher and then mostly traded up for rest of the day, however, most indices still made Harami candlestick formations. All S&P sectors closed up.

From Briefing.com:

The S&P 500 rose 1.6% on Monday in a broad-based advance paced by the mega-caps, as investors used last week’s decline as an opportunity to buy the dip. The Nasdaq Composite (+2.6%) and Russell 2000 (+2.5%) outperformed with gains over 2.0%, while the Dow Jones Industrial Average increased 0.8%. […] Every other S&P 500 sector also closed higher, with the consumer staples sector (+0.02%) eking out a fractional gain. The Philadelphia Semiconductor Index bounced back 3.9%. […] The silver market, meanwhile, appeared to be the latest short-squeeze target, although the price action was noticeably tamer. Silver futures settled higher by 7.9% to $29.21/ozt. […] U.S. Treasuries finished on a higher note despite the rebound effort in the stock market, signaling a cautious-minded sentiment. The 2-yr yield decreased one basis point to 0.11%, and the 10-yr yield decreased two basis points to 1.08%. The U.S. Dollar Index advanced 0.5% to 91.05. WTI crude futures rose 2.6%, or $1.38, to $53.56/bbl. […] The ISM Manufacturing Index for January slipped to 58.7% (Briefing.com consensus 60.1%) from a downwardly revised 60.5% (from 60.7%) for December. The dividing line between expansion and contraction is 50.0%. January marked the eighth straight month the ISM Manufacturing Index has been above 50.0%. […] Total construction spending increased 1.0% m/m in December (Briefing.com consensus 0.8%) after increasing an upwardly revised 1.1% (from 0.9%) in November. Total private construction spending rose 1.2% m/m and total public construction spending increased 0.5%. The January IHS Markit Manufacturing PMI increased to 59.2 from 59.1 in December. […] Russell 2000 +7.7% YTD Nasdaq Composite +4.0% YTD S&P 500 +0.5% YTD Dow Jones Industrial Average -1.3% YTD