GBP/USD: Squeeze Has Some Room To Go On Fading Well-Populated Long Positions – TD

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The pound suffered from stagnant wages, weak inflation, falling retail sales, a dovish Carney and worries about the Irish border. So, the falls may not be over just yet.

Here is their view, courtesy of eFXdata:

TD Research discusses GBP outlook and keeps flagging near-term downside risks, noticing that GBP continues to lag the broader G10, as the soggy CPI data and some negative Brexit headlines have inspired some position squaring.

“We think this squeeze has some room to go, which reflects that positioning and valuation look stretched alongside further weakness in the data

What’s more, the market has felt comfortable about a BoE hike next month for quite some time, suggesting that the rate hike is priced into asset markets. Instead, we think a market in search of a theme will try to make one when offered some fodder like a data or policy event that alters sentiment. It offers room to fade well-populated long positions,” TD argues.

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Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned the significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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