GBP/USD Technical Outlook: Sterling Threatens Larger Price Reversal

Bottom line: The near-term risk is for a larger recovery on this rebound with our focus higher while above 1.3164. From a trading standpoint, I’ll favor fading weakness targeting the median-line - a breach / close above would be needed to keep the long-bias viable targeting 1.3450 and a more significant resistance confluence at 1.3495-1.3504 (2017 high-day close / 2018 open).

GBP/USD IG CLIENT POSITIONING

GBP/USD Trader Positioning

 

  • A summary of IG Client Sentiment shows traders are net-long the British Pound (GBP/USD)- the ratio stands at +2.34 (70.1% of traders are long) – bearish reading
  • Traders have remained net-long since April 20th; price has moved 6.6% lower since then
  • Long positions are 2.9% lower than yesterday and 1.9% higher from last week
  • Short positions are4.5% higher than yesterday and 10.5% higher from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Sterling 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 GBP/USD price trend may soon reverse higher despite the fact traders remain net-long.

RELEVANT GBP/USD DATA RELEASES

GBP/USD Economic Calendar

 

 

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Disclosure: Do you want to see how retail traders are currently trading the US Dollar? Check out our IG Client Sentiment ...

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