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GBPUSD – Retail FX traders remain heavily short the British Pound against the US Dollar, and a contrarian view of crowd sentiment leaves us in favor of further GBPUSD strength.
Trade Implications – GBPUSD: Our purely retail sentiment-based Momentum2 has had mixed results trading the GBP in recent weeks as it trades in a broad and choppy range. But it is likely to go long as the currency trades at fresh month-to-date peaks.
We wouldn’t necessarily advocate getting long ahead of tomorrow’s potentially significant US Nonfarm Payrolls report, but we’ll look to buy into further GBPUSD strength.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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