British Pound Likely to Fall Further
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GBPUSD –Our retail FX trader data shows that the majority of traders remain long the British Pound versus the US Dollar, and a contrarian view of crowd sentiment leaves us focused on further short-term weakness. Last week we noted that traders had previously turned net-short for the first time since May, and that served as signal that the pair could be at a key turning point. That signal preceded a major break to the topside, but since then we’ve seen the pair break down and crowds have resumed buying.
And as such, one-sided sentiment now leaves us firmly in favor of selling into GBP declines.
See next currency section:USDJPY - US Dollar Looks like a Sell versus Japanese Yen
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.