Sentiment Shifts Giving GBP a Bullish Trading Bias
GBPUSD: Retail trader data shows 39.3% of traders are net-long with the ratio of traders short to long at 1.54 to 1. In fact, traders have remained net-short since Dec 28 when GBPUSD traded near 1.33774; price has moved 6.4% higher since then. The number of traders net-long is 17.8% lower than yesterday and 13.7% lower from last week, while the number of traders net-short is 0.2% higher than yesterday and 8.9% lower 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. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger GBPUSD-bullish contrarian trading bias.
--- Written by Dylan Jusino, DailyFX Research
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