19 Jun 2015
EUR/GBP negative bias remains – KBC
FXStreet (Barcelona) - The KBC Bank Research Team notes that GBP remains in excellent shape and although EUR/GBP is expected to range-trade, the negative bias for the pair remains intact.
Key Quotes
“Yesterday, the UK retail sales report could be considered as close to expectations. The reaction of sterling was limited. EUR/GBP initially held a tight range in the 0.7255/80 area. The pair closed the session at 0.7154 as the Greek debt negotiations failed. Cable extended its rally and filled bids north of 1.59, but this is in the first place due to USD weakness. The pair returned part of the intraday gains as the dollar rebounded later in the session. Cable closed the session at 1.58802 (from 1.5833).”
“Today, the monthly UK public finance data will be published. We don’t expect a lasting impact on sterling trading. With EUR/USD coming off yesterday’s highs, EUR/GBP might stay under pressure due to Greece. Cable might be ripe for some consolidation/profit taking.”
“Until mid‐May, sterling remained in good shape even as expectations for a BoE rate hike were pushed back to 2016. The UK elections were a sterling positive too. A correction kicked in at the end of May. EUR/GBP set a rebound top at 0.7386. As EUR/GBP approached a first important resistance (0.7483) we reinstalled a cautious sell‐on‐upticks bias.”
“Recent price action suggests that the downside of the range (0.7055 area) remains well protected too. For now this is a perfect range trading story. The day‐to‐day bias remains EUR/GBP negative.”
Key Quotes
“Yesterday, the UK retail sales report could be considered as close to expectations. The reaction of sterling was limited. EUR/GBP initially held a tight range in the 0.7255/80 area. The pair closed the session at 0.7154 as the Greek debt negotiations failed. Cable extended its rally and filled bids north of 1.59, but this is in the first place due to USD weakness. The pair returned part of the intraday gains as the dollar rebounded later in the session. Cable closed the session at 1.58802 (from 1.5833).”
“Today, the monthly UK public finance data will be published. We don’t expect a lasting impact on sterling trading. With EUR/USD coming off yesterday’s highs, EUR/GBP might stay under pressure due to Greece. Cable might be ripe for some consolidation/profit taking.”
“Until mid‐May, sterling remained in good shape even as expectations for a BoE rate hike were pushed back to 2016. The UK elections were a sterling positive too. A correction kicked in at the end of May. EUR/GBP set a rebound top at 0.7386. As EUR/GBP approached a first important resistance (0.7483) we reinstalled a cautious sell‐on‐upticks bias.”
“Recent price action suggests that the downside of the range (0.7055 area) remains well protected too. For now this is a perfect range trading story. The day‐to‐day bias remains EUR/GBP negative.”