Directional Bias For The Day:

• S&P Futures are higher at 8:45 AM; drifting up since 4:00 PM  on Tuesday within an upsloping flag
• The odds are for an up day with elevated volatility; watch for a break below 4547.00 for a change of sentiments
• Key economic data report due during the day:
  • ADP Non-Farm Employment Change ( -301K vs. 185K est.; prev. 776K) at 8:15 AM

Directional Bias Before Open:

Weekly: Correction Daily: Confirmed Uptrend 120-Min: Side-Up

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

Key Levels:

• Critical support levels for S&P 500 are 4550.49, 4538.03, and 4504.45
• Critical resistance levels for S&P 500 are 4579.96, 4602.11, and 4610.97
• Key levels for E-mini futures: break above 4580.00, the high of 7:45 AM and break below 4562.50, the low of 4:30 AM

Pre-Open

• On Tuesday at 4:00 PM, S&P futures (March 2022) closed at 4534.25 and the index closed at 4546.54 – a spread of about -13.25 points; futures closed at 4535.00 for the day; the fair value is -0.75
• Pre-NYSE session open, futures are higher – at 8:45 AM, S&P 500 futures were up by +35.00; Dow by +51; and NASDAQ by +202.00

Markets Around The World

• Markets in the East closed higher – Shanghai, Hong Kong, Seoul, and Singapore were closed
• European markets are mostly higher – Switzerland is lower
• Currencies (Compared to two weeks ago):
  

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

• Commodities (Compared to two weeks ago):
  • Energy futures are higher
  • Precious metals are lower
  • Industrial metals are higher
  • Soft commodities are mixed
• Treasuries (Compared to two weeks ago)
  • 10-years yield closed at 1.791%, down -7.4 basis points from two weeks ago;
  • 30-years is at 2.110%, down -7.4 basis points;
  • 2-years yield is at 1.170%, up +12.3 basis points;
  • The 10-Year-&-2-Year spread is at 0.621, down from 0.818
  • The 30-Year-&-10-Year spread is at 0.346, up from 0.319
• VIX
  • At 21.46 @ 8:15 AM; down from the last close; below the 5-day SMA;
  • Recent high = 38.9 on January 24; low =  17.36 on January 12
  • Sentiment: Risk-On

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

Monthly	December 2021 was a green candle that opened above the previous week’s real-body and closed higher with a small upper shadow and a slightly longer lower shadow; at all-time highs Stochastic (9, 1, 3): %K crossed above %D; above 90; RSI-9 is turning up from above 75; Above the upper band of a 120-month regression channel; Confirmed Uptrend: sequence of higher highs and higher lows
Weekly:	The week ending on January 28 was a green candle that looked like a hammer with a small upper shadow; Stochastic (9,1, 3): %K is crossing above %D from near zero RSI-9 has turned up; just below 40 The week was up +33.91 or +0.8%; the 5-week ATR  is 180.75 An up week; second in the last five weeks, and fourth in the previous ten weeks The weekly pivot point=4369.23, R1=4515.85, R2=4599.84; S1=4285.24, S2=4138.62; S1/S2 pivot levels were breached Below 10-week EMA and 39-week SMA; above 89-week SMA In Correction
Daily	A relatively small green candle with almost no upper shadow and a lower shadow slightly larger than the real body; breaking above a resistance level at the low of December 3, 2021 Stochastic (9, 1, 3): %K is above %D; above 85 RSI-9 has moved just above 50; above 8-day EMA; Above 20-day EMA; below 50-day EMA, 100-day SMA; above 200-day SMA Confirmed Uptrend
2-Hour (E-mini futures)	Moving up since 4:00 AM on January 28; above a congestion area from January 24; downtrend since January 4 – lower lows and lower highs; RSI-21 is rising in a zig-zag manner; above 70 Above EMA 20, which is above EMA10 of EMA50 Bias: Side-Up
30-Minute (E-mini futures)	Broke above a downtrend line from January 4 high;  broke above a Horizational Channel between 4440.00 and 4260.00; the 61.8% extension target near 4551.24 and the 100% extension target near 4620.00 RSI-21 is moving above 60 Above EMA20, which is above EMA10 of EMA50 Bias: Side-Up
15-Minute (E-mini futures)	The Bollinger Band (20, 2.0) is drifting up since 10:00 PM The Bollinger Band is slightly contracting Stochastic (9, 1, 3): %K is below %D since 8:00 AM; below 20 Bias: Up

Previous Session

Major U.S. indices closed higher on Tuesday, February 1, in lower volume. The major indices opened up and then traded sideways to down for most of the day before moving higher in the last hour of trading.

From Briefing.com:

The S&P 500 gained 0.7% on Tuesday, extending its rebound rally into February amid another strong finish into the close. The Nasdaq Composite (+0.8%) and Dow Jones Industrial Average (+0.8%) kept pace with the benchmark index, while the Russell 2000 rose 1.1%. There was a cyclical tilt to the session, evident by the leadership positions in the S&P 500 energy (+3.5%), materials (+1.7%), financials (+1.4%), and industrials (+1.4%) sectors. Conversely, the defensive-oriented utilities (-1.3%), real estate (-0.7%), and consumer staples (-0.1%) sectors closed lower. […] Treasury yields ended the session mostly lower, although the 2-yr yield settled unchanged at 1.16%. The 10-yr yield increased two basis points to 1.80%. The U.S. Dollar Index decreased 0.3% to 96.29. WTI crude futures edged higher by 0.1%, or $0.05, to $88.21/bbl. […] The January ISM Manufacturing Index dipped to 57.6% (Briefing.com consensus 57.5%) from an upwardly revised 58.8% (from 58.7%) in December. A number above 50.0% is indicative of expansion. January marked the 20th straight month of expansion for the manufacturing sector, albeit at the slowest pace since September 2020 as the effects of the Omicron variant impacted production. […] Total construction spending increased 0.2% month-over-month in December (Briefing.com consensus +0.6%) following an upwardly revised 0.6% increase (from 0.4%) in November. That was the slowest pace of increase since July 2021. Total private construction increased 0.7% month-over-month while total public construction spending decreased 1.6%. On a year-over-year basis, total construction spending was up 9.0%. […] Job openings increased to 10.925 million in December from a revised 10.775 million (from 10.562 million) in November. The final IHS Markit Manufacturing PMI for January decreased to 55.5 from 57.7 in the preliminary reading. […] Dow Jones Industrial Average -2.6% YTD S&P 500 -4.6% YTD Nasdaq Composite -8.3% YTD Russell 2000 -8.7% YTD Overseas:  Europe: DAX +1.0%, FTSE +1.0%, CAC +1.4% Asia: Nikkei +0.3%, Hang Seng closed for holiday, Shanghai closed for holiday Commodities:  Crude Oil -0.15 @ 87.92 Nat Gas -0.06 @ 4.84 Gold +2.10 @ 1801.4 Silver +0.09 @ 22.56 Copper +0.09 @ 4.42