British Pound Likely to Test Critical Lows
Receive the Weekly Speculative Sentiment Index report via PDF via David’s e-mail distribution list.
Trade Implications – GBPUSD: Our data shows that approximately 55 percent of traders in our sample are currently long the GBP versus the USD, which gives us a modestly bearish contrarian trading bias. It’s nonetheless important to note that this is a significant pullback from the 70 percent we saw two months ago. The moderation suggests that momentum will slow as the Sterling approaches critical lows near $1.60.
A sustained flip towards crowd selling would help confirm a potentially important GBPUSD price low. And indeed a GBPUSD break above key trendline resistance favors a larger correction higher.
See next currency section:USDJPY - US Dollar Predicted to Test Highs versus Yen
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
Automate our SSI-based trading strategies via Mirror Trader free of charge
To receive the Speculative Sentiment Index and other reports from this author via e-mail, sign up for his distribution list via this link.
Contact David via
Twitter at http://www.twitter.com/DRodriguezFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.