Sinuhet
Short

GBP/USD - major reversal next week around 1.73?

FX:GBPUSD   British Pound/U.S. Dollar
382 0 7
Both COT and sentinent readings for GBP reaching currently extremes warning of possible major reversal.
Further, retail forex traders are their most short the British Pound against the US Dollar             since it set an important top in February 2014: there are nearly 8 open positions short the GBP for every long!!!. One-sided sentiment extremes warn that the pair may turn lower soon.
Given the fact there is a BoE meeting on Thursday next week (10th July 2014) I am expecting a reversal around this date. I am going to open a short position with the stop by 1.7380. Ideally my entry point would be around 1.73. However if the pair breaks below 1.705 before reaching a higher high, then the reversal is done and we should have at least a short term downtreand. I will than analyse the price action to get more evidence if this is going to go below 2009 low straight away or if there is one more high (1.825?) before we finally drop below 2009 low.

P.S. Given the position in USD index and/or EUR it may be better trade to go long EUR/GBP             / short GBP/CHF             . I will decide ad hoc             .
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