EUR/GBP Price Forecast: Hovering below resistances at 0.8720 and 0.8745
- EUR/GBP appreciates for the second consecutive day and returns above 0.8700.
- The UK Government's crisis keeps the Pound on the defensive.
- Euro bulls are focusing on the 0.8720 and 0.8745 resistance levels.
The Euro (EUR) is trading higher for the second consecutive day against the British Pound (GBP) on Tuesday. A broader GBP weakness maintainsthe Euro buoyed near 0.8700 at the time of writing, right below an important resistance area between 0.8720 and 0.8745.
The sterling is among the weakest performers of the major currencies this week, as the scandal of the links between the UK’s ambassador to the US, Lord Mandelson, and convicted sex offender Jeffrey Epstein has shaken the Labour cabinet.
Prime Minister Keir Starmer has reaffirmed his will to remain in power, but the rising calls to resign are casting a shadow of political uncertainty and are pushing the British Pound, UK stocks and government bonds lower.
Technical Analysis: EUR/GBP is at the top of the descending channel
The daily chart shows the EUR/GBP trading at 0.8712, a few pips below the top of the descending channel from mid-November highs, with technical indicators reflecting a mild positive momentum. The Moving Average Convergence Divergence (MACD) histogram expands moderately, suggesting strengthening bullish impetus, and the Relative Strength Index (RSI) is at 55, showing a neutral-to-bullish bias.
Bulls would need to breach the mentioned trendline resistance at 0.8720 and extend above the December 31 and January 21 highs in the area of 0.8745 to confirm a trend shift. Further up, the target would be December's peak, in the 0.8800 area.
Support is seen at Friday's low of 0.8675, ahead of the February 4 low, at 0.8612.
(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 | -0.78% | -0.59% | -1.28% | -0.80% | -0.92% | -0.47% | -1.32% | |
| EUR | 0.78% | 0.20% | -0.56% | -0.01% | -0.14% | 0.31% | -0.54% | |
| GBP | 0.59% | -0.20% | -0.45% | -0.22% | -0.34% | 0.11% | -0.74% | |
| JPY | 1.28% | 0.56% | 0.45% | 0.53% | 0.41% | 0.88% | -0.11% | |
| CAD | 0.80% | 0.01% | 0.22% | -0.53% | -0.02% | 0.34% | -0.53% | |
| AUD | 0.92% | 0.14% | 0.34% | -0.41% | 0.02% | 0.45% | -0.40% | |
| NZD | 0.47% | -0.31% | -0.11% | -0.88% | -0.34% | -0.45% | -0.85% | |
| CHF | 1.32% | 0.54% | 0.74% | 0.11% | 0.53% | 0.40% | 0.85% |
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.
