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GBPUSD–Retail forex traders continue to buy aggressively into British Pound weakness, and a contrarian view of popular sentiment leaves us firmly in favor of selling the GBP/USD.
Our data shows there are an impressive 2.8 open GBP/USD-long positions for every one short; 74 percent of positions are short. These one-sided sentiment readings have often coincided with important extremes and price reversals, but this is only clear in hindsight. Until we see a material shift towards GBP selling, we will continue to call for GBP/USD declines.
See next currency section:USDCAD - Forex Trader Sentiment Favors Further USDCAD Gains
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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