Another Look at the Pound and Other Ramblings

The Pound is creepin' back up after a brief sell off and this time it might just break out of 1.66 resistance area that has held it back. I have previously posted that I think the pound will see 1.75 if it breaks out of the 1.66-1.67 range. Here's a daily chart of the GBP/USD with the TLT Trender v2 indicator applied and some annotations:The Pound break-out theory fits in with my overall outlook for the markets right now. For the next several months, I believe that the dollar will fall against the euro and the pound, oil will rise, and U.S. equities will continue to rise. This has been the pattern lately and I believe it will continue for a little while, unless some major change takes place (i.e. a major shock to the markets). We're probably still in a secular bear market and this move is most likely just a big bear rally that will crash hard later when things get ugly again (maybe if/or when China melts down).

For now though, there is a lot of optimism in the markets and I'll stay with my opinions stated above as long as the markets keep shruggin off bad news. Just my 2 cents.

Have a great weekend.

TLT