- EUR/GBP struggled to capitalize on its modest intraday uptick to the 0.8530-35 region.
- A modest USD pullback prompted some short-covering move around the British pound.
- A combination of factors might act as a headwind for the sterling and help limit losses.
The EUR/GBP cross surrendered modest intraday gains and dropped to the lower end of its intraday trading range, around the 0.8515 region during the early European session.
Following the previous day's pullback from two-week tops, the EUR/GBP cross regained positive traction on Wednesday, albeit struggled to capitalize on the move beyond the 0.8530-35 region. The shared currency's relative underperformance comes amid growing market worries about the potential economic fallout from the fast-spreading Delta variant of the coronavirus.
That said, a combination of factors might continue to act as a headwind for the British pound and help limit any deeper losses for the EUR/GBP cross. Investors now seem concerned that job losses in the UK will rise after the furlough scheme ends in September. This, along with Wednesday's softer UK consumer inflation figures for July, should cap gains for the sterling.
Meanwhile, the EUR/GBP cross had a rather muted reaction and moved little after the Eurozone CPI for July was finalized at 2.2% YoY, matching original estimates. Nevertheless, the fundamental backdrop remains tilted in favour of bullish traders. Hence, any subsequent decline is more likely to be short-lived and might still be seen as a buying opportunity.
Technical levels to watch
|Today last price||0.8519|
|Today Daily Change||-0.0004|
|Today Daily Change %||-0.05|
|Today daily open||0.8523|
|Previous Daily High||0.8537|
|Previous Daily Low||0.8504|
|Previous Weekly High||0.8518|
|Previous Weekly Low||0.845|
|Previous Monthly High||0.867|
|Previous Monthly Low||0.85|
|Daily Fibonacci 38.2%||0.8524|
|Daily Fibonacci 61.8%||0.8517|
|Daily Pivot Point S1||0.8506|
|Daily Pivot Point S2||0.8489|
|Daily Pivot Point S3||0.8474|
|Daily Pivot Point R1||0.8538|
|Daily Pivot Point R2||0.8554|
|Daily Pivot Point R3||0.857|
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.