August 20 (Reuters) - GBP/USD could rise to 1.40 for the first time in more than five years if the deterioration in sentiment towards the dollar deepens into the autumn. The catalyst for the deterioration was the U.S. Treasury's announcement on Wednesday that it would double the size of its U.S. long-bond buybacks. The unexpected news deflated UST yields and spurred selling of the USD – which lifted cable to a three-month high of 1.3630. A prospective cable move to 1.40 could be juiced by more squeezed GBP shorts: CFTC data showed the net GBP short position totalled a still hefty 56,221 contracts in the week ended August 11 (the net GBP short hit a nine-year high of 105,719 contracts in June).

If GBP/USD does rise to 1.40, it would arguably still be "cheap": 1.65 was its approximate average in the 10 years leading up to the Brexit referendum in June 2016.

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(Robert Howard is a Reuters market analyst. The views expressed are his own)