Daily Intermarket Outlook- June 17th

By: David Leal
The markets are at a pivotal junction at this point in time. The confidence in the global recovery plan seems to be waning, taking the positive market sentiment with it. One of the primary causes to this shift in sentiment is the falling interest in foreign countries purchasing US treasuries. So, the widely held belief is that if the US cannot fund its massive debts the world economy cannot recover. If oil falls below $70 and sustains the move, then look for equities to fall towards 880 on the S&P 500, and boosting the dollar. Tomorrow, the major source of fundamental risk is out of the UK, with the release of the bank of England’s monetary policy meeting minutes. The markets are poised to make a drop to the down side, so expect this even to weigh heavily on the pound and European equity markets. Daily Currency Pair Analysis GBPUSD: We are looking to sell the pound against the dollar on the belief that market sentiment is in the process of shifting for the short term. Potential Trade: GBPUSD sell Optimal Entry: 1.6500 Stop: above 1.6650 Target: 1.6250