Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. You could sustain a loss of some or all of your initial investment and should not invest money that you cannot afford to lose. The risks of loss from investing in CFDs can be substantial and the value of your investments may fluctuate. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how this product works, and whether you can afford to take the high risk of losing your money. IG International Limited is licensed to conduct investment business and digital asset business by the Bermuda Monetary Authority.

GBP/USD technical analysis: client sentiment remains bullish

Retail traders remain short of GBP/USD as the post-Brexit trade talks near a point of no return. Will a deal be found?

GBP/USD technical outlook:

  • GBP/USD rally hitting resistance near multi-month high.
  • IGCS – Retail traders are bearish but sentiment is bullish.

GBP/USD has been stair-stepping higher after making a swing low around $1.2675 on 23 September as market participants price-in a post-Brexit trade deal of some description. It is highly unlikely that an in-depth deal will be made in time, if at all, and any trade deal between the EU and the UK is likely to be minimal and just enough to prevent the two parties trading on WTO terms from the start of next year. While Sterling is expected to move higher on the announcement of a successful EU-UK trade outcome, the expected lack of clarity of this deal may well temper any substantial GBP-upside.

Find out more about forex trading

GBP/USD daily chart (December 2019 – 25 November 2020)

The daily chart shows that the pair remain above all three simple moving averages, a bullish set-up, while higher lows and higher highs also suggest that the recent rally may not be finished. A close and open above the $1.3516 high should keep the market biased to the upside.

IGCS – retail remain short of GBP/USD

Retail trader data shows 36.09% of GBP/USD traders are net-long with the ratio of traders short to long at $.77 to 1. We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBP/USD prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger GBP/USD-bullish contrarian trading bias.

IGCS client positioning - GBP/USD

This information has been prepared by IG, a trading name of IG US LLC. This material does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. You should not treat any opinion expressed in this material as a specific inducement to make any investment or follow any strategy, but only as an expression of opinion. This material does not consider your investment objectives, financial situation or needs and is not intended as recommendations appropriate for you. No representation or warranty is given as to the accuracy or completeness of the above information. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. Any research provided should be considered as promotional and was prepared in accordance with CFTC 1.71 and designed to promote the independence of investment research. See our Summary Conflicts Policy, available on our website.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.8 pips on EUR/USD
  • Analyze market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on the most popular forex markets


Prices above are subject to our website terms and agreements. Prices are indicative only

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading forex provider.

Stay on top of upcoming market-moving events with our customisable economic calendar.