Fear is affecting the markets as investors start to price in a recession and a “financial event”, according to Michael Hartnett, Chief Investment Strategist at BofA Merrill Lynch Global Research. Yet using a combination of five sentiment indicators, Hartnett believes that markets are oversold and that a bounce in risk assets is likely.
The spread between Greek and German 10 year bond yields is widening and has achieved a new multi-month high. Riccardo Ronco, Head of Technical Analysis at Aviate Global, thinks this may mean troubling times ahead.
There has been nothing in the recent gasoline futures price action to suggest bottoming action, says Walter Zimmermann, Senior Technical Analyst at United-ICAP, leaving “serious room open to the downside”.