- EUR/GBP's correction from recent lows down at 0.8691 to 0.8774 has been sold into again and the price now oscillates between 0.8709 and 0.8738.
- EUR/GBP started out in Asia with a bullish gap with sterling plunging due to the weekend's negative Brexit news.
EUR/GBP is now correcting higher again to 0.8741, off the recent lows at 0.8709 as cable is faded through the 10-hr SMA despite the news that the European Union chief Brexit negotiator Michel Barnier had said earlier that the main elements of the Brexit treat text were ready which is being treated with scepticism and is also being reported that he will tell EU27 that a Brexit agreement still not reached.
Instead, it is thin out there in North America today on account of Veteran's Day and sterling bulls can't find the liquidity where too many negatives surrounding the prospects for Brexit are taking their toll whereby Theresa May had been forced to abandon plans for an emergency cabinet meeting to approve a Brexit deal this week and has been publicly warned by a Brexiteer cabinet minister that she will fail to have any deal approved by the cabinet unless it is "going to deliver on the referendum result". This follows the weekend's report in The Sunday Times that four pro-EU ministers may follow Transport Minister Jo Johnson who resigned last week expressing his discontent over Brexittalks. May is losing the battle to find sufficient support for a deal with the EU, which needs to be fully agreed in parliament.
However, there is a renewed concern over Italy whereby the Commission has given Rome until Tuesday this week to present a new budget and could start disciplinary steps against Rome later this month.
"Italy may be part of the EU but its budget dispute it treating the EURUSD like the lira of old. The EURUSD is down 8.2% against the dollar since Italian election on March 4th and 3.6% since the formation of the current League/5 Star government,"
Joseph Trevisani, Senior Analyst at FXStreet highlighted.
EUR/GBP levels
Analysts at Commerzbank explained that EUR/GBP is weighing on BUT has not registered a close below the 0.8697 May low. "The move lower has not been confirmed by the daily RSI either and we would allow for a small rebound ahead of further losses. Please note we have conflicting signals here and would remain cautious. Beyond this we look for the market to remain on the defensive following the reaction lower last week from cloud resistance at 0.8894/0.8937. Failure at 0.8697 on a closing basis would target the 0.8620 2018 low."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD drops below 1.0800 after German Retail Sales data
EUR/USD has come under fresh selling pressure and trades below 1.0800 after the data from Germany showed that Retail Sales declined by 1.9% MoM in February. Resurgent US Dollar demand is adding to the downside in the pair. US data are next in focus.
GBP/USD stays weak near 1.2600 amid market caution
GBP/USD remains defensive near 1.2600 in European trading on Thursday. The hawkish tone from Fed Governor Christopher Waller keeps the US Dollar afloat amid a cautious trading environment ahead of key US data releases and the Good Friday trading lull.
Gold price holds strength ahead of US core PCE inflation
Gold price holds onto gains near $2,200 in Thursday’s European session. The precious metal exhibits firm footing ahead of the United States core PCE Price Index data for February, which will be published on Friday.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.