Among the euro-dropping factories, EURGBP claims second place on the Southside. With a 4.15% decline rate in the first half of this year, the EURGBP sits second to EURCAD of -5.55%. On the other side, EURJPY outperformed 4.39% during the same period, followed by EURSEK 2%.
Turning up to the monthly scoreboard, EURGBP contained in a range of 0.8720-0.8470- trading between the middle and lower Bollinger bands. Most of the euro crosses closed with no important moves (see below), except EURJPY and EURNZD, which ended on the opposite sides.
100MA daily and 20MA weekly capped the price
Technically, the short-term trend is getting support at 0.8530 its parallel support, but a daily close above 0.8620 its 100MA needed to confirm the trend change. Flipside, a materialistic breakdown below 0.8500-0.8470 looks unlikely at the moment, as the support is contained for now. The daily oscillator confirms the same. If you’re bullish on the pound, then long GBP against the Yen and Frank are the best safe pockets you should look at.
However, as the sub-headline says, for the past six weeks, the price capped at 20MA. Clearly, a wow factor is missing to break out the 0.8620 level to make a come back towards 0.8720. Hence 0.8530-0.8470 is the zone we should focus on again. On top of these bearish factors, the death cross on the weekly chart seems possible in the coming weeks. Please see below.
Macros:
The latest ONS data suggested UK Q1 GDP is estimated to have decreased by 1.6%- revised from the 1st estimate of a 1.5% decline. There have been contractions in services and production output; however, construction output grew over the quarter.
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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