Short positions in pounds are increasing - GBP/USD short

Speculators are ready to extend their short positions for the next 21 months, the most pessimistic forecast since 2010. The lack of progress on the Brexit talks and the increasing uncertainties for Britain are weighing on the British pound. According to Simon Derrick, chief currency strategist at BNY Mellon London, most likely the short stick will remain, if the UK continue to be so slow in Brexit talks. "I think there is a good chance of shortening the pounds from the current levels."

Comment:

Currently GBP/USD is traded at levels around 1.2797, with a breakthrough in H&S(D1), a short-term upsurge and a 23.6% correction of the long-term trend since 2014.

The entry options are two, aggressive now or conservative after correction to the area around 1.2950. SL: 1.3040 over 23.6% and upward diagonal.

Alternative Scenarios: If the price goes back over the diagonal and the 23.6% adjustment and stays there, the negative scenario will break and we're more likely to see a price increase.

Source: Bloomberg Pro Terminal

Jr Trader Petar Milanov

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