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British Pound Remains Likely to Fall Further

British Pound Remains Likely to Fall Further

David Rodriguez, Head of Product
British Pound Remains Likely to Fall Further

Why and how do we use the SSI in trading? View our video and download the free indicator here

GBPUSD–Retail forex traders continue to buy aggressively into British Pound weakness, and a contrarian view of popular sentiment leaves us firmly in favor of selling the GBP/USD.

Our data shows there are an impressive 2.4 open positions long the GBP/USD for every one that is short—matching extremes seen through October as the Sterling traded into notable short-term lows. It’s possible that such heavily one-sided positions could again coincide with a near-term bounce. Yet such extremes are, by definition, only clear in hindsight.

As long as crowds continue to buy, we will watch for further GBP weakness.

See next currency section:USDCAD - Crowd Sentiment Continues to Favor USD/CAD Gains

--- 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.

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