EUR/GBP up on GBP-selling, cautiousness ahead of data
- EUR/GBP bounces off the 0.8430 region, 2019 lows.
- Sterling loses some shine, recedes from recent tops.
- Markets’ attention remains on the UK elections next week.
Some profit taking sentiment is hurting the British pound at the end of the week, helping EUR/GBP to regain some poise and advance to the mid-0.8400s.
EUR/GBP up on GBP-selling, cautiousness ahead of data
After three consecutive daily pullbacks - including fresh yearly lows around 0.8430 on Thursday - the European cross is now attempting a rebound to the 0.8450 region.
In fact, the sterling is giving away part of its recent strong gains, exacerbated after the breakout of the 1.30 key handle vs. the greenback, and all amidst increasing likeliness of a Conservative majority win at next week’s general elections.
In addition, the pound managed to derive extra buying interest after the always-relevant UK Services PMI surprised to the upside for the month of November at 49.3. Despite the positive reading, the index still remains in the contraction territory. Earlier today, house prices tracked by the Halifax Index rose 1.0% inter-month in November and 2.1% from a year earlier, both prints coming in above estimates.
Later in the day, PM Boris Johnson and Labour’s Jeremy Corbyn will be face-to-face in a BBC One TV debate, scheduled for 20:30 BST. Across the ocean, investors’ attention is expected to remain on the US calendar, where November’s Payrolls will be in centre stage.
EUR/GBP key levels
The cross is advancing 0.13% at 0.8449 and faces the next hurdle at 0.8540 (21-day SMA) seconded by 0.8605 (high Nov.22) and finally 0.8662 (55-day SMA). On the downside, a drop below 0.8430 (2019 low Dec.5) would expose 0.8382 (monthly low May 2017) and then 0.8297 (2017 low April 18).
Author
Pablo Piovano
FXStreet
Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.
