British Pound Remains in Clear Downtrend, Losses Likely
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GBPUSD – Retail FX traders have bought aggressively into British Pound declines versus the US Dollar, and a contrarian view of crowd sentiment warns that the pair may yet continue lower. Indeed, the number of outstanding GBP/USD-long positions outnumber those short by an impressive 1.8 to 1; this is the most extreme reading since the pair tumbled through early November.
We will need to see a substantive turn towards GBP-selling to change our bearish contrarian trading bias.
See next currency section:USDCAD - US Dollar Remains in Control 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.