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British Pound Looks likely to Hold Key Support

British Pound Looks likely to Hold Key Support

David Rodriguez, Head of Product
British Pound Looks likely to Hold Key Support

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

GBPUSD– Retail FX traders are once again net-long the British Pound versus the US Dollar, and a contrarian view of ‘crowd’ sentiment points to further weakness. Last week we admittedly said the opposite as retail FX was net-short. Yet we took a measured approach to calling for GBP gains as the pair continued to trade below key resistance.

We will similarly take a measured approach in now calling for GBP/USD weakness—watch critical Sterling support near post-Brexit lows given clear risk of a bounce. The fact remains that retail traders will broadly tend to do well in slow-moving markets, and a hold of key support would keep the Sterling in a low-volatility trading range. Only a substantive shift in market trading conditions would change our mostly-neutral GBP-trading bias.

See next currency section: SPX500 - US S&P 500 Shows Clear Risk of Turn Lower

--- Written by David Rodriguez, Senior 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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