EURGBP Tests Major Support

21 October, 2016

This morning we saw the release of German PPI YoY and MoM figures for September. The former fell to -1.4%, compared to expectations of -1.2%. The latter was -0.2%, in line with expectations. Also we saw the release of UK Retail Sales and Core Retail Sales (YoY and MoM) for September, all lower than expectations.

The underperforming UK retail sales figures helped EURGBP firm.

EURGBP pulled back since 12th October after testing the long term major resistance zone between 0.9060 – 0.9150, as the selling pressure is very heavy at this level. The price held above the support level at 0.9000 between 11th to 17th, yet the level was broken on 18th. The level at 0.9000 has turned into the near term major resistance level.

The current price holds above the downside short term uptrend line support, where another support line at 0.8900 converges, which is providing a stronger support. The price is likely to rebound here.

In addition, the daily Stochastic Oscillator is below 20, suggesting a rebound.

The current trading pattern is likely to oscillate in the range between 0.8900 and 0.9060.

The resistance level is at 0.9000, followed by 0.9060 and 0.9150.
The support line is at 0.8900, followed by 0.8850 and 0.8800.

Keep an eye on the ECB interest rate and deposit rate decisions, to be released at 11:45 GMT today. The market expectations are the rates will likely remain unchanged. Yet we need to pay attention to the ECB president Draghi’s statement, to be released subsequently at 12:30 GMT, as unexpected wording will cause volatility for the Euro.


Source link  
USD Suffers on Subpoena News

The Trump Administration is back in the spotlight with news of a report that Special counsel Robert Mueller’s investigators have issued a subpoena...

Positive data negated by tax plan opposition

The US Labor Department released data on Wednesday showing the consumer price index edged up by 0.1% in October after climbing by 0.5%...

Data Boosts EUR Can CPI Boost USD?

EUR received a boost on Tuesday, as data from Destatis showed German Preliminary GDP climbed to 0.8% in Q3, beating forecasts of 0.6%. In addition...


Chinese Data Disappoints

China’s economy has been robust throughout 2017 as a continued recovery in manufacturing and industrial sectors, a healthy property market...

Data & Polls Pressure Sterling

Sterling suffered downward pressure on Tuesday as the latest monthly report from the British Retail Consortium showed non-food sales slumping...

Closing the Year on a Strong Note

Data released on Monday indicates that the Eurozone economy is on target to close out 2017 strongly. The latest Markit composite PMI fell...


Sterling Falls on Rate Rise

In line with market expectations, the Bank of England raised the UK base rate to 0.5% (from 0.25%) on Thursday. The rise, the first in 10 years, was widely...

Another Political Headache for Trump

USD gave up some of its recent gains on news that investigators had charged President Trump’s former campaign manager regarding...

US Jobless Claims Lowest Since 1973

US Department of Labor released Initial Jobless Claims for the week ending October 13th that showed a resilient and stable labor market...

  


Share: