Traders have been cutting bets on a weaker sterling ahead of Thursday's U.K.
general election, ING says. As the Conservatives continue to cement their lead
in opinion polls for the election, "speculative investors" have trimmed short
positions in the pound, ING FX strategist Francesco Pesole says, citing CFTC
data. "Sterling net positions are currently at -13% of open interest, which is
in line with its five-year average and suggests that the upside potential for
GBP stemming from more short squeezing should be fairly limited." GBP/USD is
last up 0.1% at 1.3155 and EUR/GBP is flat at 0.8417.
Forex and stock traders are looking for the consistently wrong investor, trader and take the opposite position. This will obviously lead to winning trades for them. All traders have read trading books that point out that increasing volume is good for the continuation of the trend. Many new stock traders will try and fight the trend.
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