GBP/USD: Decrease in Net-Longs Triggers Bullish Outlook
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Net-Long Positions Decrease Week Over Week
GBPUSD: Retail trader data shows 67.5% of traders are net-long with the ratio of traders long to short at 2.08 to 1. In fact, traders have remained net-long since Apr 20 when GBPUSD traded near 1.40482; price has moved 8.3% lower since then. The number of traders net-long is 3.6% lower than yesterday and 12.9% lower from last week, while the number of traders net-short is 1.4% higher than yesterday and 6.3% higher from last week.
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Decreasing Net-Longs Give Way for Potential Reversal
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 Jack Schwarze, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.