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Watch Retail Sentiment on British Pound into Brexit Vote

Watch Retail Sentiment on British Pound into Brexit Vote

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 bought aggressively into the British Pound’s recent slide versus the US Dollar, and a contrarian view of ‘crowd’ positioning acts as signal the GBP/USD may continue lower.

Our data shows traders remained net-long GBP/USD as it fell from $1.53 to lows near $1.38, but more recently we have seen periods in which traders turned net-short. If we nonetheless see a continued shift towards buying—much as we have this week—our sentiment indicator will keep us firmly in favor of selling the GBP/USD. It will be critical to watch Sterling price action headed into the highly-anticipated UK ‘Brexit’ vot e, and we expect the GBP may remain volatile in the weeks ahead.

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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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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