EUR/GBP drops to new 2023 lows around 0.8630

EUR/GBP accelerates losses to the 0.8830 region.
The Sterling outperforms in a choppy trading session.
EMU Consumer Confidence came in at -17.4 in May.

Pablo Piovano FXStreet

Further strength in the British pound dragged EUR/GBP to new YTD lows in the 0.8630/25 band on Tuesday.

EUR/GBP weaker on GBP-buying

EUR/GBP retreats for the third session in a row and seems to break below the consolidative theme in place since mid-May, just below 0.8700 the figure.

Renewed weakness in the cross came in response to the better tone in the quid, while the inconclusive price action in the dollar appears to have underpinned the sentiment in the risk-associated universe.

Some support for the euro also came after hawkish comments from the ECB’s Simkus, who advocated for further hikes in June and July.

In the euro docket, the final print of the Consumer Confidence matched the preliminary readings at -17.4 for the month of May, while Economic Sentiment and Industrial Sentiment in the broader Euroland weakened to 96.5 and -5.2 in the same period.

EUR/GBP key levels

The cross is retreating 0.44% at 0.8628 and the breakdown of 0.8547 (monthly low December 1 2022) would expose 0.8386 (weekly low August 17 2022) and finally 0.8249 (monthly low April 14 2022). On the other hand, the next resistance level aligns at 0.8750 (200-day SMA) followed by 0.8834 (monthly high May 3) and then 0.8875 (monthly high April 25).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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