Those long GBP/USD should beware of its tendency to drop in May, and a break under the April 30 1.3803 low posted would be a near-term sign of weakness.
A study of GBP/USD's performance for each May since 2000 shows it has fallen in 17 of the last 21 years, including in every year since 2010.
Seasonality should not be considered in isolation, but it's a useful tool combined with other factors.
Commodity Futures Trading Commission data show that for the week ending April 27, the value of the net long GBP position held by speculators rose to 1.83 billion pounds from 1.57 billion pounds the previous week.
GBP Refinitiv Matching data since April 27 shows traders may have exited some of those longs, but outstanding longs remain vulnerable to possible near-term sales.
GBP/USD volatility is expected by analysts ahead of Thursday's Bank of England meeting and the Scottish parliamentary elections nL1N2MR1AY.
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