Directional Bias For The Day:

• S&P Futures are higher at 8:45 AM; moved up more than 45 points since 5:30 AM;
• The odds are for an up day with elevated volatility – watch for a break below 3737.00 for a change of sentiments
• The key economic data report is due during the day:
  • Capacity Utilization ( 80.0% est.; prev. 80.5%) at 9:15 AM
  • Industrial Production ( 0.1% est.; prev. -0.2%) at 9:15 AM
  • NAHB Housing Market Index ( 43 est.; prev. 46) at10:00 AM

Directional Bias Before Open:

Key Levels:

• Critical support levels for S&P 500 are 3739.22, 3712.00, and 3689.13
• Critical resistance levels for S&P 500 are 3779.44, 3806.91, and 3829.10
• Key levels for E-mini futures: break above 3794.00, the high at 11:30 AM on October 6, and a break below 3737.00, the low of 6:45 AM

Pre-Open

• On Monday at 4:00 PM, S&P futures (December 2022) closed at 3690.00, and the index closed at 3677.95 – a spread of about +12.00 points; the futures closed at 3689.25; the fair value is +0.75
• Pre-NYSE session open, futures are higher – at 8:15 AM, S&P 500 futures were up by +76.50, Dow by +535, and NASDAQ by +244.25

Markets Around The World

• Markets in the East closed mostly higher – Shanghai closed lower
• European markets are higher
• Currencies (Compared to two weeks ago):

• Commodities (Compared to two weeks ago):
  • Energy futures are mixed
  • Precious metals are lower
  • Industrial metals are mostly higher
  • Soft commodities are mixed
• Treasuries (Compared to two weeks ago)
  • The 10-year yield closed at 4.015%, up +36.4 basis points from two weeks ago;
  • The 30-year is at 4.015%, up +30.9 basis points;
  • The 2-year yield is at 4.452%, up +34.3 basis points;
  • The 10-Year-&-2-Year spread is at -0.437, down from -0.458
  • The 30-Year-&-10-Year spread is at 0.000, down from 0.055
• VIX
  • At 31.04 @ 6:45 AM; down from the last close; below the 5-day SMA;
  • Recent high = 34.88 on September 28; low = 28.50 on October 5
  • Sentiment: Risk-On

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

Previous Session

Major U.S. indices closed higher on Monday, October 17, in mostly lower volume. Dow Jones Transportation Average traded in higher volume. The major indices opened higher and made the day’s high in the first half-hour of trading. Afterward, they moved sideways for the rest of the day. Most indices made green Harami candles near the high/open of the previous day.

From Briefing.com:

[…] Many stocks moved higher today with the advance-decline line favoring advancing issues by a greater than 4-to-1 margin at the NYSE and a greater than 2-to-1 margin at the Nasdaq. […] All 11 S&P 500 sectors closed in the green with consumer discretionary (+4.2%) showing the biggest gain. That move was bolstered by constructive comments on the state of the consumer from Bank of America following its earnings report. Consumer staples (+1.1%) and energy (+1.2%) brought up the rear. WTI crude oil futures fell 0.3% today to $85.49/bbl. Natural gas futures fell 7.7% to $5.99/mmbtu. […] The 10-yr note yield dropped to 3.91% earlier but settled up one basis point to 4.02%.  The 2-yr note yield, which hit 4.40% earlier, settled at 4.43%. […] Economic data was limited to the October Empire State Manufacturing Survey, which came in at -9.1 versus the prior reading of -1.5. A number below 0.0 is indicative of a contraction in manufacturing activity in the New York Fed region. Dow Jones Industrial Average: -16.9% YTD S&P Midcap 400: -18.8% YTD S&P 500: -22.8% YTD Russell 2000: -22.7% YTD Nasdaq Composite: -31.8% YTD