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Crowds Remain Strongly Short British Pound

Crowds Remain Strongly Short British Pound

David Rodriguez, Head of Product
ssi_usd-jpy_body_Picture_8.png, Crowds Remain Strongly Short British Pound

GBPUSD – Retail FX trading crowds remain their most net-short British Pound against the US Dollar (ticker: USDOLLAR) since it set a short-term top in late August, and indeed our sentiment-based strategies remain long GBPUSD in anticipation of further advances.

Our technical forecast for the British Pound calls for a test of key resistance near $1.6215, and indeed current price momentum favors further gains. It seems ill-advised to join retail crowds in selling the GBPUSD at these levels, as there are nearly 3 traders short for every one that is long.

How do we interpret and trade with the SSI? Watch an FXCM Expo Presentation that explains the SSI.

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com

To receive the Speculative Sentiment Index and other reports from this author via e-mail, send a message with subject line “Distribution List” to drodriguez@dailyfx.com; Contact David via Twitter at http://www.twitter.com/DRodriguezFX

Meet the DailyFX team in Las Vegas at the annual FXCM Traders Expo, November 2-4, 2012 at the Rio All Suite Hotel & Casino. For additional information regarding the schedule, workshops and accommodations, visit the FXCM Trading Expo website.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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