British Pound Forecast Bearish
GBPUSD – Forex trading crowds remain heavily net-long the British Pound against the US Dollar, warning that the pair could continue lower through upcoming trade. It serves to note that positioning was far more one-sided two weeks ago, and the relative moderation waters down our previous bearish bias. Yet the overall downtrend remains intact, and crowd sentiment calls for weakness.
The ratio of long to short positions in the GBPUSD stands at 2.28 as nearly 70% of traders are long. Yesterday, the ratio was at 1.42 as 59% of open positions were long. In detail, long positions are 12.3% higher than yesterday and 16.3% stronger since last week. Short positions are 30.1% lower than yesterday and 23.1% weaker since last week. The SSI is a contrarian indicator and one-sided sentiment signals more GBPUSD losses.
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--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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