Seasonal Context & Events

The fourth week of earnings season continues, with Industrials, Technology, and Consumer Staples remaining the primary focus. Next week, attention will shift to Consumer Discretionary and Energy sectors. There are no holidays or options expirations this week, keeping the schedule uninterrupted. However, the first few days of the week may still be influenced by inflows and outflows as funds and investors adjust their positions, potentially impacting market movement before stabilizing later in the week.

Key events include:

03rd February 15:00 UTC ISM Manufacturing PMI

04th February 15:00UTC JOLTs Job Openings

05th February 15:00UTC ISM Services PMI

06th February 13:30UTC Initial Jobless Claims

07th February 13:30UTC Unemployment Rate

Those events may or may not influence the opening direction and subsequent days.

Thermometer

Breadth

Date	Ratio
27/01/2025	0.69
28/01/2025	0.30
29/01/2025	0.41
30/01/2025	0.82
31/01/2025	0.24

Quite clear tendency to remain low.

Put/Call Ratio

OI	VO
2.69	0.75
2.21	0.63

Declined from last week, but still inconsistent reading for a rally to the up.

Coherence

SP500	+1.18%
RUT	-0.08%
DJT	-1.71%

Can’t see coherence, profit taking, slowing down.

Support & Resistance Levels

R3	6201
R2	6192
R1	6176
Close	6040
S1	5916
S2	5891
S3	5856

Wrap Up & Forecast

Yep, “Buy the rumor, sell the news”—classic. But when you prioritize quantity over quality, you’ll eventually find yourself in a less-than-ideal position. What had people panicking on Monday quickly turned out to be a low-quality fear—one of those overreactions that, in hindsight, makes little sense. Unless you’re trading, investing, or flipping coins on a completely different set of rules, that move soon proved to be untradable—like most of those dramatic openings that gap far from the previous close due to some X event.

In the coming days, you’ll see some people asking themselves, “What the hell did I just do?” while others will be thinking, “I love this.” The difference? One reacts, the other acts. It’s up to you to figure out who does what, but the answer isn’t exactly hidden. Small hint—reacting in the Market often leads to losses or, at best, flawed analysis. How do you know if you reacted or actually acted with intention? Simple—if you don’t like the outcome, there’s a 99.99999% chance you just reacted.

To save the hassle of flipping back through previous articles, I’ve updated the chart to include last week’s lines, making it easier to see how the Market moved relative to the forecast. And as always, at the bottom, you’ll find the chart for the coming week’s outlook.

What happened last week? Our linear thinking, based on the forecasted range-bound behavior between 6000$ and 6100$, would have suggested one of two scenarios: either a dip toward 6000$ followed by a climb to 6100$ by the end of the week, or, factoring in some event-driven volatility and earnings noise, a choppy ride with long wicks bouncing between those levels. But the Market has its own way of keeping things interesting—sometimes all it takes is a couple of headlines to flip the script.

The Market gapped down on Monday, dropping below the expected range to 5969$ close by S1. But funny enough, it still managed to close at 6012$—almost as if there was a reason for that, right? And from there, it climbed right toward 6100$ and then we all know what happened on Friday on the last hours (or you can just look below).

What’s next? Since the dawn of the stock market, the options have always been the same: up, sideways, or down.

Up? Sure, it’s in the mix. But meh—just looking at the candlesticks, this move seems like a retest of the January 24th high, which didn’t exactly power through resistance. Will it break next week? Well, yeah—up is always on the table, so it could happen. But if you’re paying attention to any indicator that tracks divergence (which, let’s be honest, is most indicators), you might notice a slight bearish divergence between price action and where the indicators are sitting. If you’re eyeing the upside, that’s something to keep in mind.

Sideways? Also a possibility. But let’s be real—sideways is just meh. Whether you’re a trader or an investor, you know it’s the least entertaining scenario (unless, of course, you’re into those bizarre options strategies that thrive on nothing happening).

Down? Always an option! Down to where? I’d be looking at the 5970$-5920$ range. Yep, away from al R levels.

As for my outlook? Same as previously mentioned—I still expect a dip starting around February 5th-7th, lasting until February 10th-12th, followed by a short-lived move back up toward 6200$-6250$. Honestly, I don’t have a specific downside target in mind. I’ll just let the blue dotted lines and green lines do the talking.

Yep, had to push my 6200$-6250$ target back a bit—now looking closer to February 18th. Let’s see how that plays out.