All good things must come to an end, as they say.

After 13 consecutive bullish weeks, EUR/GBP is poised to finish a week lower than the previous weeks’ close for the first time since the week beginning April 29. For all intents and purposes, this represents the longest weekly streak of gains or losses the pair has ever experienced (technically, our data shows a 13-week bearish streak on the pair back in Q1 1997, though because that period precedes the introduction of the euro itself, it uses imputed prices based on a basket of sovereign European currencies). From a fundamental perspective, this week’s soft economic data out of Germany (including an outright contraction in Q2 GDP) and the ongoing political turmoil in Italy trumped the latest Brexit wrangling, leading to the drop.

As the chart below shows, this streak has taken the single currency from below 0.8500 to a decade high above 0.9300 against its neighbor across the English Channel:

eurgbp

Source: TradingView, FOREX.com

Not surprisingly, the pair’s weekly RSI indicator is deeply overbought, so the current pullback from previous resistance near 0.9300 is not unexpected. As my colleague Fiona noted earlier this week, support comes in at 0.9090, followed by 0.9050, while resistance looms up at 0.9324 and again at 0.9400.

Moving forward, there are causes for concern on both sides of the English Channel, but the urgency of Brexit (less than 75 days away at the start of the next week) may make the current pullback short-lived. Traders will be watching for signs of a bullish reversal if the pair tests previous-resistance-turned-support near 0.9100 next week.

This research is for informational purposes and should not be construed as personal advice. Trading any financial market involves risk. Trading on leverage involves risk of losses greater than deposits.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD falls off the highs amid trade wars, weak German figures

EUR/USD is falling toward 1.1100. The German IFO Business Climate dropped to 94.3 points, below expectations. Markets are concerned by the intensifying US-Sino trade wars.

EUR/USD News

GBP/USD consolidates amid Brexit uncertainty

GBP/USD is trading below 1.2300, consolidating its gains. The UK and the EU have been blaming each other for a potential no-deal Brexit. US-Sino tensions are in play as well.

GBP/USD News

USD/JPY recovers farther from multi-year lows on Trump’s positive trade-related comments

The incoming positive trade-related comments dented the JPY’s safe-haven demand. Improving global risk sentiment helped the pair to recover around 150-pips intraday. Investors now look forward to the US durable goods orders data for a fresh impetus.

USD/JPY News

Forex Today: Trade wars paint markets in red, Brexit looks worse, and central banks are limited

Here is what you need to know on Monday, August 26th: The US-Sino trade war is painting global markets in the red. The US dollar is losing some ground to major currencies as yields plunge, while it gains against commodity currencies. Gold is rising and oil is falling.

Read more

Gold retreats from multi-year tops, fills weekly bullish gap on positive trade headlines

Gold extended its intraday pullback from fresh multi-year tops and dropped to fresh session lows in the last hour, filling the weekly bullish gap. The US-China trade tensions escalated further.

Gold News

Majors

Cryptocurrencies

Signatures