Directional Bias For The Day:

• S&P Futures are higher at 9:00 AM; futures moving within a range since 2:30 PM on Friday between 3940.00 and 3910.00
• The odds are for a sideways day – watch for a break above 3941.00 and a break below 3910.00 for clarity.
• No major economic data report is due during the day:

Directional Bias Before Open:

Key Levels:

• Critical support levels for S&P 500 are 3906.19, 3891.26, and 3865.38
• Critical resistance levels for S&P 500 are 3918.39, 3933.04, and 3958.37
• The key levels for E-mini futures are a break above 3938.50, the high at 8:30 AM on Wednesday, and a break below 3911.25, the low at 4:00 PM

Pre-Open

• On Friday at 4:00 PM, S&P futures (March 2023) closed at 3916.25, and the index closed at 3895.08 – a spread of about +21.25 points; the futures closed at 3915.50; the fair value is +0.75
• Pre-NYSE session open, futures are higher – at 9:00 AM, S&P 500 futures were up +19.25, Dow by +114, and NASDAQ by +65.50

Markets Around The World

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

• Commodities (Compared to two weeks ago):
  • Energy futures are lower
  • Precious metals are higher
  • Industrial metals are higher
  • Soft commodities are mostly lower
• Treasuries (Compared to two weeks ago)
  • The 10-year yield closed at 3.569, down -18.2 basis points from two weeks ago;
  • The 30-year is at 3.692%, down -13.5 basis points;
  • The 2-year yield is at 4.283%, down -3.6 basis points;
  • The 10-Year-&-2-Year spread is at -0.714, down from -0.588
  • The 30-Year-&-10-Year spread is at 0.123, up from 0.076
• VIX
  • At 21.75 @ 8:45 AM; up from the last close; below the 5-day SMA;
  • Recent high = 24.30 on December 22; low = 19.94 on December 21
  • Sentiment: Risk-Neutral-On

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

Previous Session

Major U.S. indices closed higher on Friday, January 6, in higher volume. The major indices opened higher and then mostly traded higher for the rest of the day. They broke above the past few days’ narrow range – a sideways move since December 16, 2022. All S&P sectors closed higher.

For the week, the major US indices closed higher in higher volume. The markets in Asia closed mixed, and the European bourses closed higher. The dollar index closed up, the energy futures closed lower, the precious metals were mixed, the industrial metals were up, and the soft commodities were mostly down for the week. The US Treasury yields closed lower.

From Briefing.com:

The stock market was able to close out the first week of 2023 on an upbeat note while also closing higher for the week overall. […] Today, the main indices all closed with a gain of at least 2.0%. […] Broad buying interest left all 11 S&P 500 sectors up at least 0.9% (health care). The heavily weighted information technology (+3.0%) and consumer discretionary (+2.4%) sectors were among the more influential leaders. […] The S&P 500 closed just shy of the 3,900 level while the Dow Jones Industrial Average jumped 700 points to 33,630. The 2-yr note yield, sitting at 4.48% before the jobs data, fell to 4.40% after the 8:30 a.m. ET report, but subsequently dropped to 4.25% after the ISM Non-Manufacturing Index. It settled the session at 4.27%. The 10-yr note yield stair-stepped from 3.74% in front of the jobs report to 3.68%, then settled at 3.56%. S&P Midcap 400: +2.4% YTD Russell 2000: +1.8% YTD Dow Jones Industrial Average: +1.5% YTD S&P 500: +1.5% YTD Nasdaq Composite: +1.0% YTD […] Nonfarm payrolls increased by 223,000 in December (Briefing.com consensus 210,000) following a revised 256,000 increase in November (from 263,000) Nonfarm private payrolls increased by 220,000 (Briefing.com consensus 200,000) following a revised 202,000 increase in November (from 221,000) The unemployment rate fell to 3.5% in December from a revised 3.6% in November (from 3.7%) Average hourly earnings rose 0.3% (Briefing.com consensus 0.4%) after a revised 0.4% increase in November (from 0.6%) The average workweek fell to 34.3 hours in December from 34.4 hours in November […] The ISM Non-Manufacturing Index for December dropped to 49.6% (Briefing.com consensus 55.0%) from 56.5% in November. The dividing line between expansion and contraction is 50.0%. […] Factory orders declined 1.8% month-over-month in November (Briefing.com consensus -0.4%) following a downwardly revised 0.4% increase (from 1.0%) in October. Shipments of manufactured goods declined 0.6% month-over-month after increasing 0.2% in October. […]