EUR/GBP jumps into five-month high at 0.8740, but bump quickly reverses direction to go red for Friday

The EUR/GBP climbed to a fresh five-month high at 0.8740 on Friday, but the Euro bid proves short-lived.
The Euro is set to close out Friday's trading session in the red, but still sees green for the week against the Pound Sterling.
Next week sees EU & UK PMI double-header on Tuesday.

Joshua Gibson FXStreet

The EUR/GBP caught a quick boost into fresh highs near 0.8740 before markets reversed the day's market flows, taking the Euro (EUR) back down against the Pound Sterling (GBP) into the red for Friday, though the EUR/GBP is still closing out a successful trading week with the pair up over 0.6% from Monday's opening prices.

UK Retail Sales firmly missed the mark on Friday, with retailer receipts declining 0.9% in September compared to August's 0.4% gain, completely flubbing the forecast -0.3%. The weak UK took the GBP out at the knees and let the Euro climb to a fresh five-month high before broad-market sentiment reversed course heading into the Friday close, sending the EUR/GBP back below the day's opening bids, leaving the pair settling into the 0.8700 handle.

Traders will be able to take a breather on economic data until next Tuesday, which kicks things off with UK labor figures, followed by a double showing of EU and UK Purchasing Manager Index (PMI) survey results.

Markets are anticipating a slight improvement in August's Employment Change, which is expected to tick upwards from -207K to -198K as investors hope for a slowdown in the UK's employment decline.

The EU Composite PMI for October is expected to improve mildly from 47.2 to 47.4, while UK PMIs for the same month are forecast to improve from 48.5 to 48.8.

EUR/GBP Technical Outlook

It's been all gains for the Euro since hitting a near-term low of 0.8616 against the Pound Sterling, and despite the intraday uptick on Friday, the EUR/GBP is seeing significant risk of getting hung up on the 200-day Simple Moving Average (SMA) currently testing into the chart region just below the 0.8700 handle.

Technical support is coming from the 50-day SMA currently building out a floor from 0.8620, and the EUR/GBP sees potential for consolidation as the two moving averages close their jaws around price action.

EUR/GBP Daily Chart

EUR/GBP Technical Levels

EUR/GBP

Overview
Today last price	0.871
Today Daily Change	-0.0004
Today Daily Change %	-0.05
Today daily open	0.8714

Trends
Daily SMA20	0.8663
Daily SMA50	0.8614
Daily SMA100	0.8601
Daily SMA200	0.8697

Levels
Previous Daily High	0.8718
Previous Daily Low	0.8674
Previous Weekly High	0.8665
Previous Weekly Low	0.8616
Previous Monthly High	0.8706
Previous Monthly Low	0.8524
Daily Fibonacci 38.2%	0.8701
Daily Fibonacci 61.8%	0.8691
Daily Pivot Point S1	0.8686
Daily Pivot Point S2	0.8658
Daily Pivot Point S3	0.8642
Daily Pivot Point R1	0.873
Daily Pivot Point R2	0.8745
Daily Pivot Point R3	0.8773

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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