Stocks confound but trouble ahead for the Pound !!

Good morning all ! Been 2 weeks since my last post where im sure you will remember my Doomsday prediction for the stock market IF we broke the key 17710/20 level in the Dow Jones (A) ... you will i'm sure have noted the low a day later at 17110.6 !! I missed the ensuing rally but i wasn't going bear turned bull , market graveyards are full of long term bears/bull turned short term bull/bears turned bankrupt !! I wasn't going down that road !

We did , at the time , have a short Nasdaq position with a tight stop (4510) Triggered on the 8th July.

Stocks continue to confound me ... No doubt technically we have broken to the upside on all the major indexes... We have broken out of a 2 year trading range to the upside (B) and we have held the breakout .

We will watch with a close eye how this breakout shapes up .... still a little too much back slapping and self congratulating on social media for my liking ... the 3rd week of July is historically a shocking week for US Indices and with the market at a very key and important level i'm keen to get short on a break back down into the range ... watch the Twitter feed or subscribe on the right hand side to make sure you don't miss any alerts !!

Our other position has fared a lot better and the more i read the more bearish of #GBPUSD i get . A tertiary hashtag search on Friday eve showed an FX pair that has dragged in value buyers again .. The Bof E holding rates on Thursday seemed to be the final straw for a lot of hot money wrong level shorts and a false upside  break almost straight after the announcement dragged a lot of longs back in with pretty much all of my sentiment metrics now pointing to a very spec long position ..  New updated chart below ...

We have now had 2 failed retests of the long term downtrend (1.3480/90) and still sit well below the post brexit high of 1.3534 (29/6/16) ... I think we test the recent multi year lows early this week and i am re iterating my call for significantly lower levels once we clear the 1.2800 level . Sell any rallies with a stop on a decent clear of the long term downtrend .

Good luck and happy trading .... updates as always via our twitter @Contrarycalls .

GAN.