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British Pound Downtrend May Finally be Over

British Pound Downtrend May Finally be Over

David Rodriguez, Head of Product

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

GBPUSD – Retail FX traders have recently sold into British Pound gains versus the US Dollar, and a contrarian view of crowd sentiment suggests the GBP/USD could continue onto fresh highs. Indeed, our data shows the majority of retail open positions have remained net-long the GBP with virtually no interruption for five months.

The Sterling has fallen from $1.53 to lows near $1.38 through that stretch, but the sudden flip in direction warns the GBP/USD downtrend may slow or even reverse. A sustained shift to net-selling would help confirm a change in trend and favor British Pound strength.

See next currency section: USDJPY - US Dollar to Fall Further versus Japanese Yen

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com

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Contact David via Twitter at http://www.twitter.com/DRodriguezFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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