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GBPUSD –Heavily one-sided retail FX positioning warns that the British Pound may continue lower versus the US Dollar.
The ratio of long to short positions in the GBPUSD stands at 2.22 as 69% of traders are long. Yesterday the ratio was 1.82; 64% of open positions were long. Long positions are 10.9% higher than yesterday and 7.0% above levels seen last week. Short positions are 9.4% lower than yesterday and 16.8% below levels seen last week. Open interest is 3.7% higher than yesterday and 7.6% 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 - Retail FX Traders Send Mixed Signals on Yen
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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