Pound Trend Mixed After Sentiment Shifts

GBPUSD: Retail trader data shows 40.5% of traders are net-long with the ratio of traders short to long at 1.47 to 1. In fact, traders have remained net-short since Dec 28 when GBPUSD traded near 1.3402; price has moved 1.0% higher since then. The number of traders net-long is 10.0% higher than yesterday and 12.8% lower from last week, while the number of traders net-short is 6.1% lower than yesterday and 17.8% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Positioning is less net-short than yesterday but more net-short from last week. The combination of current sentiment and recent changes gives us a further mixed GBPUSD trading bias.

--- Written by Dylan Jusino, DailyFX Research