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Forex Systems Sell the British Pound Against US Dollar
Thursday, 23 April 2009 14:09:10 GMT  |  David Rodriguez, Quantitative Strategist
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GBP/USD ratio: -1.10
Trading Forecast: Bullish

04-23-09_ssi_4

GBPUSD –Our forex trading strategies have recently sold the British Pound against the US Dollar—a clear shift from their previously bullish stance. Last week we aggressively called for British Pound advances on extreme contrarian sentiment, but a clear shift in positioning has forced us to take a commensurate shift in biases. The ratio of long to short positions in the GBPUSD stands at -1.10 as nearly 52% of traders are short. Yesterday, the ratio was at -1.00 as 50% of open positions were short. In detail, long positions are 3.4% lower than yesterday and 22.0% stronger since last week. Short positions are 6.3% higher than yesterday and 46.7% stronger since last week. Open interest is 1.4% stronger than yesterday and 44.9% above its monthly average. The SSI is a contrarian indicator and now gives weak forecast for short-term gains. Yet the fairly neutral positioning ratio gives us little confidence in short-term direction.

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