EUR/GBP surges to 1-1/2 week tops on disappointing UK data


The EUR/GBP cross built on previous session's up-move and jumped to 1-1/2 week tops near 0.8835 region post dismal UK data.

The cross caught some fresh bids and now seems to have decisively broken through a six-day-old trading range after data released from the UK showed an unexpected contraction in manufacturing and industrial output during the month of May. In fact, the UK manufacturing production fell 0.2% m-o-m during May, lower than 0.2% rise recorded in April and worse than 0.5% growth expected. 

   •  UK industrial production drops unexpectedly in May

Meanwhile, total industrial output also showed a 0.1% drop in the reported month, down from a 0.2% rise seen in April. Moreover, UK May visible trade deficit rose more-than-expected to £-11.863 billion from previous month's £10.595 billion and added to this week's series of UK data-disappointment, which was eventually seen weighing heavily on the British Pound. 

With the EUR/USD major consolidating perceived hawkish ECB minutes-led overnight strong gains, weaker sentiment surrounding the British Pound is turning out to be an exclusive driver of the pair's strong up-move to the highest level since June 28. 

   •  ECB: Monetary and financial conditions still very loose - Nomura

Technical levels to watch

From current levels, immediate resistance is seen near mid-0.8800s, above which the cross is likely to head back towards 0.8880 level (yearly tops) before aiming to reclaim the 0.8900 handle.

On the downside, the 0.8800 handle now becomes an immediate support to defend, which if broken could drag the cross back towards 0.8780-75 horizontal support en-route strong horizontal support near 0.8755-50 region.
 

Share: Feed news

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


Recommended content

Editors’ Picks

AUD/USD: Next stop emerges at 0.6580

AUD/USD: Next stop emerges at 0.6580

The downward bias around AUD/USD remained unabated for yet another day, motivating spot to flirt with the area of four-week lows well south of the key 0.6700 region.

AUD/USD News

EUR/USD looks cautious near 1.0900 ahead of key data

EUR/USD looks cautious near 1.0900 ahead of key data

The humble advance in EUR/USD was enough to partially leave behind two consecutive sessions of marked losses, although a convincing surpass of the 1.0900 barrier was still elusive.

EUR/USD News

Gold extends slide below $2,400

Gold extends slide below $2,400

Gold stays under persistent bearish pressure after breaking below the key $2,400 level and trades at its lowest level in over a week below $2,390. In the absence of fundamental drivers, technical developments seem to be causing XAU/USD to stretch lower.

Gold News

Why this week could be explosive for Ethereum

Why this week could be explosive for Ethereum

Ethereum (ETH) is down nearly 1% on Monday as exchanges have begun confirming Tuesday as the launch date for ETH ETFs. Considering the ETH ETF launch and the upcoming Bitcoin Conference, this week could prove crucial for Ethereum.

Read more

What now for the Democrats?

What now for the Democrats?

Like many, I applaud Biden’s decision.  I would have preferred that he’d made it sooner, but there’s still plenty of time for the Democrats to run a successful campaign. In fact, I wish something on the order of a two-month campaign – as opposed to a two-year campaign – were the norm and not the exception. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures