Directional Bias For The Day:

• S&P Futures are high at 9:00 AM; down more than 20 points since 5:15 AM and broken below a Double Top pattern on 15-minute charts – the 61.8% extension target is near 3586.00, and the 100% extension target is near 3575.00
• The odds are for a sideways to a down day with elevated volatility – watch for a break above 3632.25 for a change in sentiments
• The key economic data report is due during the day:
  • PPI ( 0.4% vs. 0.2% est.; prev. -0.1%) at 8:30 AM
  • Core PPI ( 0.3% vs. 0.3% est.; prev. 0.4%) at 8:30 AM

Directional Bias Before Open:

Key Levels:

• Critical support levels for S&P 500 are 3568.66, 3552.77, and 3543.84
• Critical resistance levels for S&P 500 are 3606.20, 3623.31, and 3636.47
• Key levels for E-mini futures: break above 3632.25, the high of 8:15 AM and a break below 3601.25, the low of 8:30 AM

Pre-Open

• On Tuesday at 4:00 PM, S&P futures (December 2022) closed at 3599.75, and the index closed at 3588.84 – a spread of about +11.00 points; the futures closed at 3599.25; the fair value is +0.50
• Pre-NYSE session open, futures are a bit higher – at 8:30 AM, S&P 500 futures were up by +6.25, Dow by +57, and NASDAQ by +32.75

Markets Around The World

• Markets in the East closed mixed – Shanghai, Sydney, Mumbai, and Seoul closed higher; Hong Kong, Tokyo, and Singapore closed lower
• European markets are lower
• Currencies (Compared to two weeks ago):

• Commodities (Compared to two weeks ago):
  • Energy futures are mixed
  • Precious metals are higher
  • Industrial metals are higher
  • Soft commodities are mostly higher
• Treasuries (Compared to two weeks ago)
  • The 10-year yield closed at 3.966%, up +0.2 basis points from two weeks ago;
  • The 30-year is at 3.942%, up +11.3 basis points;
  • The 2-year yield is at 4.296%, up +0.9 basis points;
  • The 10-Year-&-2-Year spread is at -0.330, down from -0.323
  • The 30-Year-&-10-Year spread is at -0.024, up from -0.135
• VIX
  • At 33.51 @ 7:00 AM; down from the last close; above the 5-day SMA;
  • Recent high = 34.88 on September 28; low = 28.50 on October 5
  • Sentiment: Risk-Neutral

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

Previous Session

Major U.S. indices closed mixed on Tuesday, October 11, in higher volume. Many indices made Doji or similar indecisive candlestick formations. Dow Jones Industrial Average, Dow Jones Transportation Average, and Russell 2000 closed higher.

The market gapped down at the open but turned around in the first hour of trading.  It then moved higher into the positive territory before giving up most of the day’s gains after 2:00 PM on BOE news.

From Briefing.com:

[…] Along the way, the S&P 500 set a new low for the year (3568.45). That low came shortly after the open, yet it stoked renewed buying interest that would carry the S&P 500 to 3,640.66 at its high for the day. […] The second leg lower today followed news of BoE Governor Andrew Bailey advising pension funds that they have three days left to rebalance, keeping in line with the BoE’s prior indication that its emergency purchases of gilts would end October 14. […] The Dow Jones Industrial Average (+0.1%) squeezed out a modest gain, […] For the S&P 500, only four of the 11 sectors closed in positive territory, led by real estate (+1.0%). Communication services (-1.6%) and information technology (-1.5%) sank to the bottom of the pack. The 10-yr Treasury note yield rose six basis points to 3.94% (after hitting 4.00% overnight) and the 2-yr note yield was unchanged at 4.30%. Energy complex futures settled the session in mixed fashion. WTI crude oil futures fell 1.9% to $89.18/bbl while natural gas futures rose 2.1% to $6.60/mmbtu. […] Dow Jones Industrial Average: -19.5% YTD S&P Midcap 400: -20.3% YTD S&P 500: -24.7% YTD Russell 2000: -24.6% YTD Nasdaq Composite: -33.4% YTD Overseas:  Europe: DAX -0.4%, FTSE -1.1%, CAC -0.1% Asia: Nikkei -2.6%, Hang Seng -2.2%, Shanghai +0.2% Commodities:  Crude Oil -1.74 @ 89.18 Nat Gas +0.14 @ 6.60 Gold +9.00 @ 1685.60 Silver -0.20 @ 19.44 Copper -0.01 @ 3.43