EUR/GBP: upside bias preferred above 0.8743
|Currently, EUR/GBP is trading at 0.8931, down -0.50% on the day, having posted a daily high at 0.8987 and low at 0.8921.
EUR/GBP continues to consolidate between aforementioned range on a week where the FOMC meets, UK GDP Q2 and German CPI. The PMI's were a miss inducing some downside in the euro in Europe. EZ Markit Comp Flash PMI Jul arrived at 55.8 vs forecast 56.2, prev 56.3. EZ Markit Mfg Flash PMI Jul came in at 56.8 vs forecast 57.2, prev 57.4 and EZ Markit Serv Flash PMI Jul 55.4 vs forecast cast 55.5, prev 55.4.
"UK 2Q GDP is expected to be sluggish and surveys risk reflecting the growing uncertainty around Brexit, explained analysts at Westpac, adding, "the vulnerable UK government is facing problematic legislation and a weakening of its Brexit negotiation stance."
EUR/GBP levels
EUR/GBP near term has reached its Fibo resistance, as noted by analysts at Commerzbank, "EUR/GBP finished the week by touching the 61.8% retracement of the move down from the October 2016 spike high – this is located circa 0.8987 and we would not be at all surprised to see the market consolidate below here ahead of any further strengthen towards 0.9059, the highs from mid October 2016." "The market will now stay immediately bid above the 0.8743 14th July low. Initial support is the 0.8781 near term channel," added the analysts at Commerzbank.
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