EUR/GBP retreats further from two-month tops, downside seems limited

  • EUR/GBP witnessed some selling on Wednesday and snapped three days of the winning streak.
  • Stronger USD was seen as a key factor behind the shared currency’s relative underperformance.
  • Brexit woes, COVID-19 jitters might act as a headwind for the British pound and help limit losses.

The EUR/GBP cross retreated nearly 30 pips from the daily swing highs and dropped to fresh session lows, around the 0.8625 region in the last hour.

The cross struggled to capitalize on its modest intraday gains, instead met with some fresh supply near the 0.8655-60 region and retreated further from two-month tops touched in the previous session. Sustained US dollar buying was seen as a key factor behind the shared currency's underperformance, which, in turn, exerted some pressure on the EUR/GBP cross.

The downside, however, remains cushioned amid the impasse over the Northern Ireland Protocol of the Brexit deal. British Prime Minister Boris Johnson told parliament on Wednesday that there are practical steps to solve the issues. Adding to this, the UK's chief Brexit negotiator, David Frost, said that we want a new path and negotiate a new balance with the EU.

This, along with the resurgence of the COVID-19 infections in the UK, might continue to act as a headwind for the British pound and help limit any deeper losses, at least for the time being. Moreover, investors might also refrain from placing any aggressive bets, rather prefer to wait on the sidelines ahead of the European Central Bank meeting on Thursday.

There isn't any major market-moving economic data due for release on Wednesday, either from the Eurozone or the UK. This further makes it prudent to wait for some strong follow-through selling before confirming that the EUR/GBP cross has topped out in the near term and positioning for any meaningful corrective slide.

Technical levels to watch


Today last price 0.8627
Today Daily Change -0.0019
Today Daily Change % -0.22
Today daily open 0.8646
Daily SMA20 0.8574
Daily SMA50 0.8589
Daily SMA100 0.8605
Daily SMA200 0.877
Previous Daily High 0.867
Previous Daily Low 0.862
Previous Weekly High 0.858
Previous Weekly Low 0.8504
Previous Monthly High 0.8646
Previous Monthly Low 0.8531
Daily Fibonacci 38.2% 0.8651
Daily Fibonacci 61.8% 0.8639
Daily Pivot Point S1 0.8621
Daily Pivot Point S2 0.8595
Daily Pivot Point S3 0.8571
Daily Pivot Point R1 0.867
Daily Pivot Point R2 0.8695
Daily Pivot Point R3 0.872



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

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD bounces toward 1.18 as the dollar takes a breather

EUR/USD has bounced off the fresh three-month low of 1.1751 and trades closer to 1.1780 as the US dollar takes a breather from gains. Covid concerns and speculation ahead of Thursday's ECB decision weighed on the euro earlier. 


GBP/USD recovers amid an improving market mood

GBP/USD is trading above 1.36, benefiting from a better market mood. Earlier, the pound struggled with a fresh EU-UK clash over the Northern Irish protocol and high levels of covid cases. 


XAU/USD’s downside remains exposed towards $1790

Gold price targets levels sub-$1800 as USD remains in a win-win situation. US Senate vote on infrastructure bill eyed amid lack of relevant economic news.

Gold News

Four reasons why Cardano could soon experience 60% sell-off

Cardano price is setting up a top reversal head-and-shoulders pattern on a daily time frame. A breakout from this technical formation might result in a 60% sell-off. On-chain metrics show that ADA bulls are hanging by a thread.

Read more

Gamestop (GME): Three reasons to buy GME

Monday was a pretty good day for the original meme stock – GameStop. What was a pretty bad day for markets saw GME shares buck the trend with a gain of 2.6% to close up at $173.49. Any stock that closes up when the S&P was down 1.6% deserves a closer look.

Read more