The euro pared gains made during the Asian session as traders reacted to disappointing GDP data from the Eurozone. According to Eurostat, the Eurozone’s gross domestic product fell by 40.3% in the second quarter, exceeding the consensus estimate of 32.9%. Still, the currency has had its best month in more than a decade and flash data shows that it is recovering faster than the US. Retail sales, manufacturing, and services PMIs have started to rise. Also, the EU has agreed on a landmark 750 billion spending package.

The British pound rose slightly against the US dollar as investors reacted to the upbeat house price data. According to the Nationwide Society, the house price index rose by an annualised rate of 1.5% in July. That was better than the decline of 0.3% that analysts were expecting. It was also better than the previous month’s decline of 0.1%. On a month-on-month basis, the index rose by 1.7% after falling by 1.6% in June. Elsewhere in Europe, the Norwegian unemployment rate rose to 4.9% while the Italian CPI dropped to 0.3%.

US futures and European indices are in the green as investors react to strong corporate earnings data from the US. Facebook’s revenue rose by 11% to $18.7 billion while Apple’s revenue rose to $59.7 billion. Amazon made more than $88.9 billion while Alphabet made $38.3 billion. In total, the market cap of the four giants rose by more than $230 billion in afterhours trading. They are now valued at more than $5 trillion. In Europe, BNP Paribas’ revenue rose by 4% to 11.7 billion euros. It allocated 329 million euros to loss provisions. Meanwhile, the US agreed to pay $2.1 billion to Sanofi and GlaxoSmithKline for 100 million doses of their vaccines.



The EUR/USD pair declined slightly after reaching its highest level in more than 2 years. The pair is trading at 1.1835, which is slightly above the bullish pennant that formed yesterday. Also, the price is above the 50-day and 100-day exponential moving averages. The RSI has moved below the overbought level of the RSI. Therefore, this being the final trading day of the month, the pair could remain under pressure as traders take profits.




The GBP/USD pair rose to an intraday high of 1.3132. On the daily chart, the price is above the short and medium-term moving averages. It is also above the 61.8% Fibonacci retracement level. Similarly, the RSI has moved to the highest level in more than a year while the accumulation and distribution has continued to rise. Therefore, like the EUR/USD, the GBP/USD could be under pressure during the American session.




The EUR/GBP dropped sharply today as traders reacted to the strong economic data from the UK and the weak GDP numbers from the Eurozone. The pair is trading at 0.9010, which is the lowest it has been since July 21. On the four-hour chart, the price is below the short and longer-term moving averages. It is also a few pips above the important support of 0.9000. Also, the RSI has dropped to the lowest level since the first week of June. Therefore, the pair is likely to continue falling during the American session.


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