British Pound Remains in Downtrend - Test of Support is Key
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GBPUSD –Consistently one-sided retail forex trader sentiment warns that the British Pound may continue lower versus the US Dollar. A key caveat is that the recent GBP/USD move above $1.5150 leaves little notable resistance until congestion zones surrounding $1.5250 and $1.5350.
We would ideally see a break below resistance-turned-support at $1.5150 to call for further near-term weakness. And yet our retail FX trader sample shows that the majority of traders have remained net-long the GBP/USD since it traded near $1.56 in August; a contrarian view of crowd sentiment keeps our broader trading bias bearish.
See next currency section: USDCAD - US Dollar Targets Multi-Year Highs versus Canadian Dollar
--- 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.