25 Mar 2016
EUR/GBP: downside limited on Brexit fears
EUR/GBP is currently consolidated in a trend-less markets today as we head into a long weekend for most around the world.
The pound got some profit taking support yesterday and the greenback is a mixed bag ahead of a key week next week. This week, we had poor durable goods but today a better than expected GDP result was a positive surprise. We will now look ahead to PCE data on Monday and the nonfarm payrolls next Friday ahead of April's FOMC meeting, all of which will be driving sentiment in the greenback through the euro and sterling.
However, for the cross, we are in an environment where the UK referendum on its EU membership is a strong driving force and the pound is most vulnerable in the resulting threat of ‘Brexit', stalling the downside recovery in the cross.
EUR/GBP levels
The 100 sma on the 30 min sticks at 0.7907 capps upside attempts as the cross consolidates the downside from 0.7945. Bears in EUR/GBP target 0.7880 and a break below opens the 200 sma on the 1hr sticks at 0.7859 as last defense for the 0.7800/10. On the flip side, 0.7880 guards 0.7900/20, 0.7923 R1, R2 at 0.7943 and R3 0.7963.
The pound got some profit taking support yesterday and the greenback is a mixed bag ahead of a key week next week. This week, we had poor durable goods but today a better than expected GDP result was a positive surprise. We will now look ahead to PCE data on Monday and the nonfarm payrolls next Friday ahead of April's FOMC meeting, all of which will be driving sentiment in the greenback through the euro and sterling.
However, for the cross, we are in an environment where the UK referendum on its EU membership is a strong driving force and the pound is most vulnerable in the resulting threat of ‘Brexit', stalling the downside recovery in the cross.
EUR/GBP levels
The 100 sma on the 30 min sticks at 0.7907 capps upside attempts as the cross consolidates the downside from 0.7945. Bears in EUR/GBP target 0.7880 and a break below opens the 200 sma on the 1hr sticks at 0.7859 as last defense for the 0.7800/10. On the flip side, 0.7880 guards 0.7900/20, 0.7923 R1, R2 at 0.7943 and R3 0.7963.