EURGBP Outlook: Fresh weakness was sparked by strong UK and weak German data

Slobodan Drvenica Windsor Brokers

EURGBP

The cross accelerated lower on Tuesday as pound rallied on strong earnings data and Euro came under increased pressure on German ZEW miss.
Fresh bears dipped to 0.8754, marking over 61.8% retracement of 0.8723/0.8825 recovery leg and signaled lower top at 0.8825 (recovery top, posted on Monday).
Return below falling 10SMA (0.8784) brought daily MA’s back to full bearish setup and momentum turned south, adding to negative outlook.
Key support at 0.8723 (10 Oct low) is coming in focus, with break here to expose 0.8697 (29/30 May double-bottom) and open way for full retracement of 0.8620/0.9098 Apr/Aug uptrend.
Price action remains below thickening weekly cloud which twisted last week and maintains pressure.

Res: 0.8784; 0.8810; 0.8825; 0.8834
Sup: 0.8747; 0.8723; 0.8717; 0.8697

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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