- EUR/GBP moves higher and surpass the 0.9200 mark.
- Increasing selling pressure in the pound helps the upside.
- Focus stays on the BoE and the probability of extra easing.
The downside pressure around the quid is motivating EUR/GBP to trespass the 0.9200 mark and advance to fresh 7-month highs.
EUR/GBP stronger on GBP-selling
EUR/GBP is prolonging the March rally on Wednesday, advancing for the eighth session in a row and breaking above the key barrier at 0.92 the figure to record new highs in levels last traded in August 2019.
The unremitting selling bias surrounding the quid has been behind the sharp rally in the European cross in the last couple of weeks. Indeed, the sterling is on the defensive on the back of rising speculations that the BoE could announce further easing of its monetary conditions in order to fight the impact of the COVID-19 on the UK economy.
In the calendar, final CPI figures in the euro area matched the preliminary readings, showing consumer prices rising 0.4% inter-month and 1.2% from February 2019.
What to look for around GBP
The British Pound remains entrenched well into the negative territory so far this week, shedding extra ground and falling to levels last seen in times of the Plaza Accord in 1985 vs. the greenback and to multi-month lows vs. the euro. Prospects of further easing by the “Old Lady” in combination with USD-strength are heavily weighing on the sterling and keep the bearish outlook unaltered for the time being. In addition, GBP is expected to remain under the microscope in light of the upcoming EU-UK trade negotiations to kick in later this year.
EUR/GBP key levels
The cross is up 0.98% at 0.9210 and faces the next hurdle at 0.9271 (2020 high Mar.18) seconded by 0.9324 (2019 high Aug.12) and then 0.9306 (2017 high Aug.29). On the downside, a drop below 0.9099 (78.6% Fibo of the August-December drop) would expose 0.9019 (monthly high Oct.10 2019) and finally 0.88745 (200-day SMA).
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.
Recommended content
Editors’ Picks
EUR/USD stays below 1.0700 as USD gathers strength
EUR/USD continues to trade in negative territory below 1.0700 on Wednesday. Higher-than-expected increase in US JOLTS Job Openings for April provides a boost to the US Dollar and weighs on the pair as investors keep a close eye on US debt-limit news.
GBP/USD struggles to recover above 1.2400
GBP/USD has lost its traction and declined below 1.2400 after having climbed above that level earlier in the day. The pair struggles to gather recovery momentum as the US Dollar holds its ground after strong employment data. Markets await House vote on debt-limit bill.
Gold extends daily rebound beyond $1,970
Gold price has gained traction and advanced above $1,970 in the second half of the day on Wednesday. The benchmark 10-year US Treasury bond yield stays in negative territory and allows XAU/USD to keep its footing. Market mood remains cautious ahead of the debt-ceiling vote.
Ethereum holders pull $1 billion in ETH off exchanges hinting retail-led rally
Ethereum holdings in exchange wallets declined by $1.04 billion between May 8 and May 31. Interestingly, while large wallet investors have shed their Ether holdings, the altcoin got redistributed to addresses with less than 1 ETH.
C3.ai Stock News: After 33% rally, AI shares backtrack ahead of earnings
C3.ai (AI) stock slipped 7.6% to $41.62 in Wednesday’s premarket ahead of quarterly earnings expected after the close. This may just be traders taking profits after Tuesday’s 33.4% surge in the AI stock price.