Evening fellow traders.

We’ve got another Sunday market report for you tonight.

Let’s dive right in!

Impact Snapshot

• MLK Day U.S. Stocks Closed - Monday

• Fed Manufacturing - Tuesday

• Retail Sales - Wednesday

• Unemployment Claims - Thursday

• Consumer Sentiment - Friday

Market Evaluation

The S&P 500 rose 1.8% this week, erasing last week's decline and putting the market benchmark into positive territory for the new year to date.

This week's climb came as the first round of Q4 corporate earnings reports arrived mixed but somewhat better than anticipated. 

Also, an unexpected month-over-month drop in December US producer prices helped to ease investors inflation concerns after December's US consumer prices rose more than expected.

With US markets closed Monday in observation of Martin Luther King, Jr. Day, results from the financial sector and Wednesday's retail sales data should serve as the main calendar catalysts.

Markets Breakdown

Last week we highlighted the main focus of buyers, targeting a new higher high of the range in order to clear the poor high towards 4840 that failed twice.

Passive sellers absorbed any aggression from the buying effort both on Thursday as well as Friday and halted the continuation above this key area.

As always, with everyone expecting that higher high, the moment the market turns the slightest, it shakes off these traders easily enough to produce long liquidations.

The key highlight that we’ve shared throughout through out our reports was the decreasing volume to this upside. 

Despite this being a rotation from the lows of the balance area, it’s worth mentioning that this type of activity is “old business” and likely another short-covering rally, not new money buying.

We have yet to see strong buying activity in this market.

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The key areas we will be looking for next week:

• Upside Levels: 4842/4850/4876

• Downside Levels: 4776/4759/4743

That’s all we got for you in this one!

As always, all we ask in return is that you share this Substack with 2 friends.

We’ll see you again on Tuesday.

-The QuantVue Team