Directional Bias For The Day:

• S&P Futures are higher;
• The odds are for an up day – watch for break below 3294.50 for change of fortune
• Key economic data due:
  • Retail Sales ( 0.3% vs. 0.3% est.; prev. 0.3%) at 8:30 AM
  • Core Retail Sales (0.7% vs. 0.5% est.; prev. 0.1%) at 8:30 AM
  • Philly Fed Manufacturing Index (17.0 vs. 3.7 est.; prev. 0.3) at 8:30 AM
  • Import Prices ( 0.3% vs. 0.3% est.; prev. 0.1%) at 8:30 AM
  • Unemployment Claims ( 204K vs. 217K est.; prev. 214K) at 8:30 AM
  • NAHB Housing Market Index ( est. 74 ; prev. 76) at 10:00 AM
  • Business Inventories ( est. -0.1%; prev. 0.2%) at 10:00 AM

Directional Bias Before Open:

Key Levels:

• Critical support levels for S&P 500 are 3298.66, 3280.69 and 3277.19
• Critical resistance levels for S&P 500 are 3307.52, 3316.37 and 3332.72
• Key levels for eMini futures: break above 3308.00, the high of 3:30 AM and break below 3294.50, the low of 8:30 PM

Pre-Open

• On Wednesday, at 4:00 PM, S&P future (March 2020) closed at 3291.00 and the index closed at 3289.29 – a spread of about +1.75 points; futures closed at 3293.75 for the day; the fair value is -2.75
• Pre-NYSE session open, futures are higher – at 8:15 AM, S&P 500 futures were up by +10.00; Dow by +72 and NASDAQ by +34.50

Markets Around The World

• Markets in the East closed mostly higher – Shanghai was down;
• European markets are mostly lower – Spain and Italy are up
• Currencies:
  

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

• Commodities:
  

  Up	Down
  NatGas Gold Silver Copper Platinum Palladium Cocoa	Crude Oil Sugar Coffee Cotton

• Bonds
  • 10-yrs yield closed at 1.788%, down from January 14 close of 1.818%;
  • 30-years is at 2.242%, down from 2.275%
  • 2-years yield is at 1.548%, down from 1.568%
  • The 10-Year-&-2-Year spread is at 0.240 down from 0.250
• VIX
  • Is at 12.15 down -0.27 from January 15; below 5-day SMA
  • Recent high was 16.39 on January 6; recent low was 11.72 on December 26

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

Previous Session

Major U.S. indices closed higher on Wednesday, January 15 in mixed volume. S&P 500 and NASDAQ Composite traded in higher volume. Only three S&P sectors – Consumer Discretionary, Energy and Finance closed down.

From Briefing.com:

The stock market set new highs in the moments leading up to signing of the Phase One trade deal on Wednesday, but a fade in momentum left the S&P 500 up just 0.2% for the session. The Dow Jones Industrial Average (+0.3%) closed at a record high, the Nasdaq Composite increased 0.1%, and Russell 2000 increased 0.4%.

[…]

The defensive-oriented S&P 500 utilities (+1.4%), health care (+0.9%), real estate (+0.8%), and consumer staples (+0.7%) sectors were today’s best-performing sectors. Conversely, the energy (-0.7%), financials (-0.6%), and consumer discretionary (-0.3%) sectors finished in the red.

[…]

U.S. Treasuries ended the session on a higher note as part of a defensive-oriented trade. The 2-yr yield and the 10-yr yield declined three basis points each to 1.55% and 1.79%, respectively. The U.S. Dollar Index declined 0.2% to 97.23. WTI crude declined 0.8%, or $0.44, to $57.86/bbl.

[…]

• The Producer Price Index for final demand increased 0.1% (Briefing.com consensus +0.2%) and so did the Producer Price index for final demand, excluding food and energy (Briefing.com consensus +0.2%). Those changes left the yr/yr increases at 1.3% and 1.1%, respectively, versus 1.1% and 1.3% in November.
o The key takeaway from the report is that it isn’t going to convince the Federal Reserve that it needs to raise its policy rate soon.
• The Mortgage Bankers Association reported a 30.2% surge in weekly mortgage applications, which included a 16% increase in purchase application volume.
• The Empire State Manufacturing Survey for January increased to 4.8 (Briefing.com consensus 2.8) from the prior month’s reading of 3.5.
• The Federal Reserve’s Beige Book for December noted that economic activity during the last six weeks of 2019 continued expanding at a modest pace.