• US stock futures show gains on Monday, with Dow futures up 0.1% and S&P 500 and Nasdaq 100 futures rising 0.2%.

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• Last week’s market declines were influenced by a US credit rating downgrade and surging Treasury yields.
• Investors now await a fresh round of corporate earnings reports and closely monitor US consumer and producer inflation data for insights on the economy and interest rates.
• The dollar index steadies around 102 as investors brace for US inflation data to guide economic and monetary policy outlook.
• The US added 187K jobs in July, slightly below market expectations, while wage growth and the unemployment rate provided mixed signals on the job market’s condition.
• Traders bet on the Fed keeping monetary policy restrictive for some time, supporting the dollar’s strength.
• The yield on the US 10-year Treasury note retreated below 4.1% as traders digest the payrolls report and the Treasury Department’s plan to increase auction sizes.

The E-mini S&P 500 has been trading below the balanced price range for three consecutive sessions, leading to potential absorption as core buyers aim to build long positions for a potential pullback to the bracket, depending on the auction process and upcoming economic data.

In the prior session, a double distribution profile emerged as the market aims to fill the low volume area between the distributions, resulting in a more likely balanced behavior. The Point of Control (POC) of this profile could serve as a critical support/resistance level in this session. Additionally, the market might target the previous VWAP close level around 4528, which could attract core short positions in the New York trading session.

The current higher dollar adds pressure to the index, and combined with positive volatility, it might drive sellers into the market. Looking at the median-term perspective of the volatility, it seems to lean towards the selling side, as investors seek potential shorting opportunities amidst the recent four-day downside rotation.

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