Pound May Reverse Higher According to Sentiment
Net-Long Traders Drops Below 70%
GBPUSD: Retail trader data shows 67.7% of traders are net-long with the ratio of traders long to short at 2.09 to 1. In fact, traders have remained net-long since Apr 20 when GBPUSD traded near 1.42353; price has moved 5.9% lower since then. The number of traders net-long is 4.5% lower than yesterday and 5.4% lower from last week, while the number of traders net-short is 3.8% higher than yesterday and 6.3% higher from last week.
GBPUSD Trend Likely To Reverse Higher
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBPUSD prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse higher despite the fact traders remain net-long.
--- Written by Abdullah AlAmoudi, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.