EUR/GBP’s charting a support structure, bulls look for parity


  • EUR/GBP is testing the downside but bulls are lurking.
  • EUR/GBP parity could be on the cards in the not too distant future. 

EUR/GBP has been sliding to a key support structure and is currently trading -0.66% having fallen within a range of between 0.9239 and 0.9057 as the pound firms up the hardest vs the declining greenback. The Bank of England announcement was a temporary roadblock for the GBP bulls while US jobless claims took over the market's concern.

EUR/GBP parity here we come? 

BoE: Corona shock to weaken the sterling – Nordea

The Bank of England announced its latest monetary policy decision and left interest rates unchanged at 0.10%. At the same time, in its accompanying policy statement, the Monetary Policy Committee was noted that it stands ready to expand asset purchase further if needed, which seemed to be the only factor that exerted some downward pressure sterling. Meanwhile, the markets foresight remains that a UK recession is inevitable and with the BoE asset purchases as a heavy weight for the pound and rates, there is an increasing number of risks that could take EUR/GBP to parity. 

European nations may well be overwhelmed with the number of cases and the virus thriving in the region, but we should not forget that the UK may not be far behind and considering its late call to action to lock down the population, we are yet to see how badly contaminated the UK really is. If the UK is anything like what we are seeing in Italy and now Spain, the UK's financial system will be the pounds biggest risk. If the UK economy takes a slightly harder hit in the next three months than the euro area, EUR/GBP would likely rise. 

On a footnote, also, we have the end-June deadline for extending the Brexit transition period is on the horizon and Boris Johnson may well wish to stick to his guns despite COVID-19 and take the UK off the negotiation table which means a hard Brexit and a Canada+ agreement is not on the cards – another likely spanner in the works for the pound. EUR/GBP parity here we come? 

EUR/GBP levels

EUR/GBP

Overview
Today last price 0.9084
Today Daily Change -0.0076
Today Daily Change % -0.83
Today daily open 0.916
 
Trends
Daily SMA20 0.8925
Daily SMA50 0.8627
Daily SMA100 0.8573
Daily SMA200 0.8754
 
Levels
Previous Daily High 0.9276
Previous Daily Low 0.9056
Previous Weekly High 0.95
Previous Weekly Low 0.8988
Previous Monthly High 0.8644
Previous Monthly Low 0.8282
Daily Fibonacci 38.2% 0.914
Daily Fibonacci 61.8% 0.9192
Daily Pivot Point S1 0.9052
Daily Pivot Point S2 0.8943
Daily Pivot Point S3 0.8831
Daily Pivot Point R1 0.9272
Daily Pivot Point R2 0.9384
Daily Pivot Point R3 0.9493

 

 

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.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!


Latest Forex News

Editors’ Picks

AUD/USD holds onto recovery gains above 0.6050, RBA eyed

AUD/USD stays within the two-hour-old 0.6080-6100 range, currently around 0.6090, while stepping forward for Tuesday’s Asian session. In doing so, the pair holds onto Monday’s recovery gains, mainly due to slightly positive coronavirus (COVID-19) data from Europe, ahead of the key RBA meeting.

AUD/USD News

USD/JPY: Mildly bid above 109 amid mixed sentiment

Having benefited from the recovery in virus data from global hot-spot, while marking a three-day winning streak on Monday, USD/JPY buyers seem to catch a breath around 109.25 amid the early Asian session on Tuesday.

USD/JPY News

Gold: Refreshes four-week high, $1,685 on bulls’ radar

Gold prices remain on the front foot while taking the bids near $1,668, up 0.70%, amid the Asian session on Tuesday. In doing so, the bullion refreshes the four-week high with an intraday peak of $1,674.15 while also marking a fifth consecutive daily gain.

Gold News

WTI snaps three-day winning streak

WTI oil fell by over 8% on Monday, ending a three-day winning streak, which saw prices rise from $19.94 to $29.11. The black gold fell as Saudi Arabia and Russia's decision to delay an emergency meeting to discuss output cuts shifted focus back to oversupply concerns.

Oil News

Johnson Hospitalised, Oil Awaits Treatment

Sterling slipped after UK Prime Minister Boris Johnson was moved to the intensive care unit for coronavirus treatment, but the broad risk trade remained strong on optimism with slowing growth in the number of Corona virus cases. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures