EUR/GBP Price Forecast: Euro keeps hovering near the 0.8650 support area
- EUR/GBP ticked up to 0.8670, but remains close to the support area at 0.8650.
- German GDP beat expectations in Q4, but investors await Eurozone data to confirm the economic improvement.
- The pair is trading right above the neckline of a large Head & Shoulders formation.
The Euro is in a bearish trend since mid-November, with price action pinned to the support area around 0.8650 after failing to rise above the 0.8700 level earlier this week. Strong shop price inflation in the UK and murmurs of further ECB easing have weighed down the pair this week.
Data from Germany released on Friday showed that Gross Domestic Product grew above expectations in the third quarter, providing some support for the Euro. Investors, however, will await Eurozone GDP and German inflation figures to confirm the economic improvement.
Technical Analysis: EUR/GBP is at the neckline of a bearish Head & Shoulders
The daily chart shows the EUR/GBP trading at 0.8670 at a short distance from the neckline of a large Head & Shoulders formation, at 0.8650. Technical indicators support the bearish view. The Moving Average Convergence Divergence is flat around the zero line while the Relative Strength Index (RSI) remains in bearish territory, unable to return above the key 50 level.
A confirmation below the 0.8650 level, which has limited losses several times in January, might lure bears to retest mid-August lows, at the 0.8600 area. Further down, the next target would be at late June lows around 0.8515. Resistance levels are at the 0.8700-08710 area (January 27, 28 highs) and the January 21 high, at 0.8745.
(The technical analysis of this story was written with the help of an AI tool.)
Pound Sterling Price This week
The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.33% | -0.56% | -0.23% | -1.16% | -0.86% | -1.31% | -0.67% | |
| EUR | 0.33% | -0.23% | 0.13% | -0.84% | -0.53% | -0.99% | -0.35% | |
| GBP | 0.56% | 0.23% | 0.02% | -0.60% | -0.31% | -0.76% | -0.11% | |
| JPY | 0.23% | -0.13% | -0.02% | -0.94% | -0.64% | -1.06% | -0.44% | |
| CAD | 1.16% | 0.84% | 0.60% | 0.94% | 0.18% | -0.13% | 0.49% | |
| AUD | 0.86% | 0.53% | 0.31% | 0.64% | -0.18% | -0.46% | 0.19% | |
| NZD | 1.31% | 0.99% | 0.76% | 1.06% | 0.13% | 0.46% | 0.65% | |
| CHF | 0.67% | 0.35% | 0.11% | 0.44% | -0.49% | -0.19% | -0.65% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Author
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
