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Smart Money Bets on British Pound Weakness

David Rodriguez

ssi_gbp-usd_body_Picture_13.png, Smart Money Bets on British Pound Weakness

GBPUSD – Retail FX crowds continue buying aggressively into British Pound tumbles, and our sentiment-based trading strategies remain positioned for further declines.

Trade Implications – GBPUSD: Our proprietary SSI data shows that crowds are now their most net-long GBPUSD since the pair set a multi-year low back in March. That’s obviously a warning sign that the move might be overdone (and GBP could bounce), but context is everything.

It’s entirely possible that the British Pound set a key high on May 1 at $1.5605, and the fact that USD volatility prices continue to surge suggests that professional/institutional traders are positioning for further GBPUSD weakness. We remain in favor of selling any noteworthy GBP bounces as it holds key highs.

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

ssi_gbp-usd_body_1a_1.png, Smart Money Bets on British Pound Weakness

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