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:

Weekly: Uptrend Daily: Uptrend Under Pressure

120-Min: Down-Side 30-Min: Side-Up 15-Min: Up 6-Min:  Up

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:

Monthly	Confirmed Uptrend December 2020 was a green candle with a small gap and with almost no upper and lower shadows; all-time closing and intraday highs; Stochastic %K above %D near 100; RSI-9 above 70; broke above a downtrend line from January 2018 Above the upper band of a 120-month regression channel; The sequence of higher highs and higher lows is resumed
Weekly:	The week ending on January 29 was a large Bearish Engulfing candle from all-time highs with small upper and almost lower shadows; Stochastic (9,1, 3): %K is below %D; below 50 RSI (9) is near 55 after making Bearish Divergence The week was down -127.23 or -3.3%; the 5-week ATR is 113.23 A down week; second in the last five weeks and fourth in the last ten weeks The weekly week pivot point=3759.75, R1=3825.39, R2=3936.53; S1=3648.61, S2=3583.97; S1/S2/S3 pivot levels were breached At/below 10-week EMA; above 39-week SMA, and 89-week SMA Uptrend since March 23
Daily	A green Harami candle with almost no lower shadow and small upper shadow Broke above a symmetrical triangle at 3550.00 level on November 9; the 61.8% extension target near 3750.00 is achieved; 100% extension target is near 3900.00 %K  crossed above %D from near 10; RSI-9 is near 50; below 8-day EMA Below 20-day EMA; above 50-day EMA; above 100-day, and 200-day SMA Uptrend Under Pressure
2-Hour (E-mini futures)	Continuing the bounce from a swing low – 3652.50, the low of January 4 – to near 3804.00; broke above a downtrend line from the all-time high RSI-21 is near 70 after making a Bullish Divergence at 6:00 PM on Sunday Above EMA20, which is above EMA10 of EMA50 Bias: Down-Side
30-Minute (E-mini futures)	Trending up since 6:00 PM on Sunday; broke above congestion area between 3775.00 and 3800.00; next resistance level is near 3823.50 RSI-21 is between 60 and 65 %K is crisscrossing %D lower Above EMA20, which is above EMA10 of EMA50 Bias: Side-Up
15-Minute (E-mini futures)	The Bollinger Band (20, 2.0) is moving up since 10:15 PM on Sunday; The Bollinger Band is contracting slightly since 7:30 AM Stochastic (9, 1, 3): %K is crisscrossing %D higher Bias: Up

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