Sharp Shift in Sentiment Warns of British Pound Weakness
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GBPUSD - The ratio of long to short positions in the GBPUSD stands at 1.67 as 63% of traders are long. Yesterday the ratio was 1.21; 55% of open positions were long. Long positions are 12.5% higher than yesterday and 15.2% above levels seen last week. Short positions are 18.3% lower than yesterday and 16.6% below levels seen last week. Open interest is 1.4% lower than yesterday and 7.7% above its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the GBPUSD may continue lower. The trading crowd has grown further net-long from yesterday and last week. The combination of current sentiment and recent changes gives a further bearish trading bias.
See next currency section:USDJPY - USDJPY Rallies Should be Sold, Dips Bought
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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