News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • $ARKK down to a fresh three month low but finding some support on this confluent fibo level. If the rates theme continues could add more pressure here https://t.co/vfi4AHZKHd
  • tech side of the $USD forecast already starting to fill in with today's bullish breakout 😎 https://t.co/vHVn9WtWKX
  • I just finished my USD 4Q fundamental forecast with @JStanleyFX (who did the techs) at the end of last week. Today certainly jazzes up my assessment
  • The S&P 500 has opened with a sharp gap lower while the Dollar pushes an 11 month high. DailyFX's @JohnKicklighter talks about volatility, debt limits, and Fed forecasts! https://t.co/xNr8VZi1SC
  • $SPX trying to hold support after failing at resistance yday $SPY $ES currently about 4% off of the all time high https://t.co/uo5ohs01UU
  • Nasdaq tumbles 2% $NDX
  • The ICE's trade-weighted $DXY Dollar Index is at an 11 month high today. Notably, its largest component - $EURUSD - has not slipped the August low https://t.co/RbkyJVC2Oq
  • Stocks extend fall, Dow Jones down 1% following worse-than-expected US Consumer Confidence #trading $DJIA
  • Big enough disappointment to heap onto the risk aversion but not bad enough to restart speculation of a delayed November taper from the FOMC. Net net, further bearish pressure on $SPX https://t.co/oprOLVTdQX
  • The $SPX has opened today with its biggest bearish gap since last Monday's tumble. Officially squashes the recovery momentum and now we are more balanced in facing fundamental event risk - bullish or bearish https://t.co/hW5U62hWez
GBP/USD IG Client Sentiment: Traders Are Selling Reversion into Multi-Month Range

GBP/USD IG Client Sentiment: Traders Are Selling Reversion into Multi-Month Range

Christopher Vecchio, CFA, Senior Strategist
Advertisement

IG CLIENT SENTIMENT INDEX: GBP/USD RATE FORECAST (JULY 27, 2021) (CHART 1)

GBP/USD Client Positioning

Number of traders net-short has increased by 67.26% from last week.

SYMBOL

TRADING BIAS

NET-LONG%

NET-SHORT%

CHANGE IN LONGS

CHANGE IN SHORTS

CHANGE IN OI

GBP/USD

BULLISH

48.21%

51.79%

-12.24% Daily

-37.87% Weekly

6.60% Daily

67.26% Weekly

-3.40% Daily

-7.88% Weekly

GBP/USD: Retail trader data shows 48.21% of traders are net-long with the ratio of traders short to long at 1.07 to 1. In fact, traders have remained net-short since Jun 16 when GBP/USD traded near 1.40, price has moved 0.77% lower since then. The number of traders net-long is 12.24% lower than yesterday and 37.87% lower from last week, while the number of traders net-short is 6.60% higher than yesterday and 67.26% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBP/USD prices may continue to rise.

Our data shows traders are now net-short GBP/USD for the first time since Jun 16, 2021 when GBP/USD traded near 1.40. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger GBP/USD-bullish contrarian trading bias.

GBP/USD RATE TECHNICAL ANALYSIS: DAILY CHART (APRIL 2020 TO JULY 2021) (CHART 2)

Please add a description for the image.

Last week, GBP/USD rates dropped out of the broader sideways range in place since early-February, between 1.3660 and 1.4250. But the decline in rates was quickly reversed as support come into play around a cluster of Fibonacci levels.

The return to the multi-month range suggests a false bearish breakout may have transpired now that GBP/USD cleared the downtrend from the May and June swing highs.

If the decline last week constitutes a bear trap, then a full-scale reversal with the multi-month range may soon develop (which would ultimately target the broader range high near 1.4250).

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES