The FTSE 100 was bullish yesterday but the S&P 500 was bearish. The FTSE was stimulated by the declining GBP/USD, the dollar is bouncing back so GBP/USD is declining. I believe this decline in GBP/USD is a pullback in the uptrend, this means GBP/USD will not go to new lows, the pullback will end soon then GBP/USD will rally.
It is normal for the dollar to rebound after last week's sell off. It would appear the dollar peaked and the next move is a long decline. A long decline because if the Fed cuts rates and do QE it’s bearish for the dollar.
Yesterday Fed chairman Powell tempered expectations of a rate cut, the S&P fell as a results. Powell said that the Fed is assessing whether current economic uncertainties call for lower rates. Fed official Bullard said that if there is a cut in July it will be 25 basis point and not 50 as many people had hope for.
The pull back in the S&P was a reaction to a less aggressive rate cut, in any case rates in the US will go down and the dollar will go down. It shows that investors tend to rush to buy based on assumptions that are not always valid. The stock market rally is nearing an end.