• EUR/GBP gained strong positive traction on Friday and shot back to the weekly high.
  • Stronger Eurozone CPI figures reaffirmed ECB rate hike bets and boosted the euro.
  • Cautious BOE, Brexit woes undermined the GBP and contributed to the strong move.

The EUR/GBP cross built on the overnight goodish rebound from mid-0.8500s, or a nearly two-week low and gained strong positive traction on the last day of the week. The buying interest picked up pace during the early part of the European session and pushed spot prices to the 0.8650-0.8655 region, back closer to the weekly high.

The shared currency's relative outperformance comes amid a clear signal by the European Central Bank that it would begin the rate hike cycle in June. Furthermore, a 50 bps hike in September is seen as an almost done deal and the bets were reaffirmed by stronger Eurozone consumer inflation figures released earlier this Friday.

According to the preliminary estimate published by Eurostat, the annualized Eurozone Harmonised Index of Consumer Prices (HICP) accelerated to 8.6% in June. This was well above market expectations for a rise to 8.4% from the 8.1% reported in May, which, in turn, was seen as a key factor that provided a fresh lift to the EUR/GBP cross.

On the other hand, the British pound was pressured by expectations that the Bank of England would adopt a gradual approach toward raising interest rates amid growing recession fears. Apart from this, concerns about fresh UK-EU tensions over the Northern Ireland Protocol of the Brexit agreement should act as a headwind for sterling.

The fundamental backdrop supports prospects for a further near-term appreciating move for the EUR/GBP cross. Hence, some follow-through strength towards reclaiming the 0.8700 mark, en-route the YTD peak around the 0.8720 region, remains a distinct possibility.

Technical levels to watch

EUR/GBP

Overview
Today last price 0.8656
Today Daily Change 0.0046
Today Daily Change % 0.53
Today daily open 0.861
 
Trends
Daily SMA20 0.8581
Daily SMA50 0.8524
Daily SMA100 0.8438
Daily SMA200 0.8446
 
Levels
Previous Daily High 0.862
Previous Daily Low 0.8551
Previous Weekly High 0.8641
Previous Weekly Low 0.8562
Previous Monthly High 0.8721
Previous Monthly Low 0.8486
Daily Fibonacci 38.2% 0.8577
Daily Fibonacci 61.8% 0.8594
Daily Pivot Point S1 0.8568
Daily Pivot Point S2 0.8525
Daily Pivot Point S3 0.8499
Daily Pivot Point R1 0.8637
Daily Pivot Point R2 0.8663
Daily Pivot Point R3 0.8706

 

 

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

AUD/USD losing bullish steam as concerns weigh

AUD/USD losing bullish steam as concerns weigh

Wall Street trimmed its recent gains and approaches weekly lows, reflecting persistent market fears. AUD/USD turned south and risks additional slides as China is set to unveil growth-related figures.

AUD/USD News

EUR/USD corrective advance extends towards 0.9800

EUR/USD corrective advance extends towards 0.9800

The EUR/USD pair advanced for a second consecutive day, now trading a handful of pips below the next big figure. With no real reasons to buy the EUR, the movement seems more related to profit-taking.

EUR/USD News

Gold consolidating weekly gains amid broad dollar’s weakness

Gold consolidating weekly gains amid broad dollar’s weakness

XAUUSD trades around $1,660, pressuring the weekly high. The metal fell to an intraday low of $1,641.46 but resumed its advance as investors keep moving away from the safe-haven currency. The market´s mood is far from optimistic. 

Gold News

Bitcoin price ruptures $19,000 support oblivious to ballooning BTC/GBP’s trading volume

Bitcoin price ruptures $19,000 support oblivious to ballooning BTC/GBP’s trading volume

BTC appears to be playing games with investors in move that see price action repeatedly undermined. Earlier in the week, the flagship cryptocurrency jumped to $20,200 but immediately snapped out of the northbound move to test support at $18,500.

Read more

US August PCE Inflation Preview: Will it trigger a dollar correction? Premium

US August PCE Inflation Preview: Will it trigger a dollar correction?

The US Bureau of Economic Analysis will release the Personal Consumption Expenditures (PCE) Price Index data, the US Federal Reserve’s preferred gauge of inflation, for August on Friday, September 30.

Read more

Forex MAJORS

Cryptocurrencies

Signatures