EUR/GBP clings to modest gains above 0.9100 mark, 4-week tops

EUR/GBP gained traction on Monday and built on last week's goodish rebound.
The shared currency remained well supported by the EU recovery fund agreement.
A modest pickup in demand for the pound capped the upside near the 0.9135-40 area.

Haresh Menghani FXStreet

The EUR/GBP cross retreated around 20 pips from the early European session bullish spike to four-week tops and was last seen trading with modest gains, just above the 0.9100 mark.

The cross built on last week's goodish bounce from the key 0.9000 psychological mark and gained some follow-through traction on the first day of a new trading week. The shared currency remained well supported by the latest optimism over a landmark agreement on €750 billion pandemic recovery fund.

The euro got an additional boost following the release of German IFO Business Climate Index, which came in at 90.5 in July as against the anticipated rise to 89.3 from 86.2 previous. This comes on the back of Friday's upbeat Eurozone PMI prints, which pointed to a V-shaped economic recovery.

Meanwhile, the Current Economic Assessment arrived at 84.5 points for the reported month as compared to last month's 81.3 and 85.0 estimated. The IFO Expectations Index also improved further to 97.0 in July, up from the previous month’s reading of 91.4 and better than the market expectations of 93.7.

On the other hand, the British pound benefitted from a broad-based US dollar weakness and seemed rather unaffected by renewed fears of a no-deal Brexit. A stronger GBP turned out to be a key factor that kept a lid on any further gains for the EUR/GBP cross near the 0.9135-40 supply zone.

It is worth recalling that the latest round of negotiations ended last Thursday without significant progress on the post-Brexit trade deal. Britain's chief Brexit negotiator David Frost said that they will not be able to strike a preliminary agreement by the UK PM Boris Johnson's July deadline.

Nevertheless, the near-term bias for the EUR/GBP cross remains tilted in favour of bullish traders. A sustained move beyond the mentioned barrier will reinforce the positive outlook and set the stage for a move beyond the recent swing high, around the 0.9175 region, towards reclaiming the 0.9200 mark.

Technical levels to watch

EUR/GBP

Overview
Today last price	0.9125
Today Daily Change	0.0015
Today Daily Change %	0.16
Today daily open	0.911

Trends
Daily SMA20	0.9046
Daily SMA50	0.9
Daily SMA100	0.893
Daily SMA200	0.8723

Levels
Previous Daily High	0.9125
Previous Daily Low	0.9084
Previous Weekly High	0.9138
Previous Weekly Low	0.9001
Previous Monthly High	0.9176
Previous Monthly Low	0.8864
Daily Fibonacci 38.2%	0.9109
Daily Fibonacci 61.8%	0.91
Daily Pivot Point S1	0.9088
Daily Pivot Point S2	0.9065
Daily Pivot Point S3	0.9047
Daily Pivot Point R1	0.9129
Daily Pivot Point R2	0.9147
Daily Pivot Point R3	0.917

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

GBP/USD advances to three-month peak beyond 1.3600

GBP/USD extends its daily rally and trades at its highest level since mid-May above 1.3600. The US Treasury Department decision to double the sice of liquidity support buyback operations for longer-dated nominal coupon securitiez weighs heavily on the US Dollar and helps the pair push higher. Earlier in the day, the data from the UK showed that annual Consumer Price Index (CPI) inflation picked up to 2.9% in July, meeting estimates, while core CPI rose by 2.6% YoY in July versus 2.5% expected.

EUR/USD surges to 11-week high above 1.1650 after US Treasury announcement

EUR/USD gathers bullish momentum and trades at its highest level since early June above 1.1650 on Wednesday. The US Dollar stays under heavy bearish pressure after the US Treasury announced that it will increase the size of liquidity support buyback operations for longer-dated nominal coupon securities. Later in the day, investors will scrutinize FOMC Minutes for fresh clues on policy outlook.

Gold climbs 2% as US Treasury buyback plan pressures long-term yields

Gold (XAU/USD) enters Wednesday’s American trading hours with decent intraday gains, as a softer US Dollar (USD) and a sharp pullback in long-term US Treasury yields help the metal recover all the previous day’s losses.

Crypto Today: Bitcoin, Ethereum, XRP defend key support as ETF inflows return

Bitcoin’s upside remains capped on Wednesday while the downside appears strongly supported above $64,000. The Crypto King’s early week rebound lost momentum near $65,000 as investors assessed the impact of geopolitical tensions in the Middle East.

Fed Minutes expected to shed light on the depth of FOMC hawkish split

The United States (US) Federal Reserve (Fed) will release the Minutes of the July Federal Open Market Committee (FOMC) meeting on Wednesday. The document should allow investors to assess the extent of the hawkish bias within the central bank after a meeting marked by three dissenting votes in favor of a rate hike.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.