LOWEST PERCENTAGE OF NET-LONG TRADERS SINCE OCTOBER 04
GBPUSD: Retail trader data shows 53.8% of traders are net-long with the ratio of traders long to short at 1.16 to 1. In fact, traders have remained net-long since Sep 20 when GBPUSD traded near 1.28725; price has moved 0.9% lower since then. The percentage of traders net-long is now its lowest since Oct 04 when GBPUSD traded near 1.30226. The number of traders net-long is 1.6% lower than yesterday and 4.3% lower from last week, while the number of traders net-short is 28.4% higher than yesterday and 13.8% higher from last week.
GBPUSD PRICE TREND MAY REVERSE
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 Nancy Pakbaz, CFA, DailyFX Research