GBP/USD: Retail Traders Remain Long In Face of a 7% Drop in Price
Net-Short Positions Decrease 8% Overnight
GBPUSD: Retail trader data shows 65.1% of traders are net-long with the ratio of traders long to short at 1.86 to 1. In fact, traders have remained net-long since Apr 20 when GBPUSD traded near 1.40333; price has moved 7.8% lower since then. The number of traders net-long is 4.9% lower than yesterday and 0.9% lower from last week, while the number of traders net-short is 8.0% lower than yesterday and 6.1% lower from last week.
To gain more insight to how we use sentiment to power our trading, join us for our weekly Trading Sentiment webinar.
Decreasing Short Positions Suggest Prices May Slump Lower
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBPUSD prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger GBPUSD-bearish contrarian trading bias.
--- Written by Jake Schoenleb, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.