CATEGORY EUR/GBP

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EUR/GBP: Strong bounce, double bottom?

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EUR/GBP: Strong bounce, double bottom?

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FXStreet (Córdoba) – The euro rebounded sharply against the pound and rose more than 80 pips from the lows erasing weekly losses. EUR/GBP is testing a downtrend line from January highs and a break above could give more bullish momentum to the pair.

The euro gained strength during the last hours across the board as stocks failed to sustain the recovery and tumbled to fresh lows. The risk aversion environment boosted EUR/GBP, that was falling before on the back of data from the UK.

Tomorrow the Bank of England will release a statement with the decisions on monetary policy, the minutes of the meeting and the Quarterly Inflation report that is likely to impact on the pound.

EUR/GBP: Double bottom?

Three hours ago the pair bottomed at 0.7524 that is also the lowest level it reached two weeks ago. Today it bounced from the mentioned level but so far it has remained below 0.7600 but could have formed a double bottom. According to the double bottom pattern a break above 0.7660 could trigger a rally toward 0.7800.

Currently, it trades at 0.7680/85, at the same level it closed yesterday. It hit a fresh daily at 0.7608 but so far it has been unable to hold on top of 0.7600.

The euro rebounded sharply against the pound and rose more than 80 pips from the lows erasing weekly losses. EUR/GBP is testing a downtrend line from January highs and a break above could give more bullish momentum to the pair.

(Market News Provided by FXstreet)

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EUR/GBP falls to fresh daily lows

FXStreet (Córdoba) – EUR/GBP failed to regain the 0.7620 area and came under pressure during the American session, falling to fresh daily lows with the euro losing steam against the dollar and the pound as European stocks recovered from lows.

EUR/GBP dropped nearly 50 pips and slid to a fresh low of 0.7574 in recent dealings but found support. At time of writing, the pair is trading at 0.7577, down 0.28% on the day.

EUR/GBP technical levels

In terms of technical levels, next supports are seen at 0.7562 (20-day SMA), 0.7500 (psychological level) and 0.7465 (Jan 13 low). On the other hand, resistances could be found at 0.7622 (Feb 1 high), 0.7660/65 (Jan 26, 27 & 28 highs) and 0.7755 (Jan 20 high).

EUR/GBP failed to regain the 0.7620 area and came under pressure during the American session, falling to fresh daily lows with the euro losing steam against the dollar and the pound as European stocks recovered from lows.

(Market News Provided by FXstreet)

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EUR/GBP eyes November lows

FXStreet (Córdoba) – The euro is falling against the pound for the third day in a row as it continues to decline after making on Friday a strong reversal. EUR/GBP declined further today below 0.7100, approaching November lows.

EUR/GBP reversal continues

Last week the pair gained momentum and recovered from three month lows and peaked near 0.7200 on Thursday. But it turned to the downside, resuming the downtrend. From last week highs it has fallen 130 pips.

If it continues to decline the next support level could be located at 0.7040 (Nov 5 low); but a daily close under 0.7050 could signal a bearish continuation exposing 0.7000.

On the opposite direction the pair still remains between the recent trading range, above 0.7050 and facing resistance at 0.7150. A consolidation above 0.7150 could remove bearish pressure, but the key resistance area is the 0.7200 zone, that is a static resistance and also where the 20 and 100-day MA currently stand. A break higher could change the short term trend, that continues to favor the pound.

The euro is falling against the pound for the third day in a row as it continues to decline after making on Friday a strong reversal. EUR/GBP declined further today below 0.7100, approaching November lows.


(Market News Provided by FXstreet)

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Is the BoE the Fed’s Mini-Me? – Commerzbank

FXStreet (Córdoba) – The FX market seems to think that Fed and Bank of England (BoE’s) monetary policies will move largely in parallel, said Ulrich Leuchtmann, analyst at Commerzbank. According to him, while the BoE’s policy is indeed influenced by the Fed’s actions, the impact is certainly not as significant as assumed by the market.

Key Quotes

“The G10 currencies have been considerably more volatile since the beginning of the year, with one clear exception: GBP/USD. In contrast to EUR/USD and EUR/GBP, GBP/USD has been considerably less volatile this year. That means that the market assumes a high correlation between the EUR/USD and the EUR/GBP exchange rate (currently about 74%). Investors seem to expect that the key influence on USD, EUR and GBP exchange rates will have a similar effect on USD and GBP in the near future”.

“With monetary policy still being the predominant issue on the FX markets, it is quite easy to spot this factor. There is a broad consensus among market participants that the BoE’s monetary policy (in particular the timing of the first rate hike) will depend to a considerable extent on the Fed’s rate decision”.

“The market expects that if the Fed increases its key rate soon, the BoE will follow suit. And in this scenario, both EUR/USD and EUR/GBP would depreciate. However, the markets’ expectations of the two exchange rates moving in synch might be exaggerated. The BoE is not the Fed’s Mini-Me. Especially at the beginning of a rate-hike cycle which might be slower than in the past, each central bank will have to individually signal its starting point and the subsequent pace of rate hikes. This will create uncertainty”.

“The fact that BoE governor Mark Carney did not change his rhetoric yesterday (even though the FOMC took a more hawkish stance) is not surprising. Moreover, one reason why the Fed’s course is so important for the BoE’s policy is that the BoE (just like many other central banks) wants to avoid an excessive FX reaction to its monetary policy decisions. That is why the BoE will take into account the fact that the ECB will soon pursue an even more expansionary course – and then, the current expectations concerning the correlation between EUR/GBP and EUR/USD will turn out to be exaggerated”.

The FX market seems to think that Fed and Bank of England (BoE’s) monetary policies will move largely in parallel, said Ulrich Leuchtmann, analyst at Commerzbank. According to him, while the BoE’s policy is indeed influenced by the Fed’s actions, the impact is certainly not as significant as assumed by the market.

(Market News Provided by FXstreet)

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EUR/GBP on track to test 0.7057 – Commerzbank

FXStreet (Edinburgh) – In the opinion o Axel Rudolph, Senior Technical Analyst at Commerzbank, the door remains open for a visit of the 0.7057 level.

Key Quotes

EUR/GBP is on track to reach the .7057 May low below which lies the .6937 July low and the 38.2% retracement of the move from 1971 at .6915”.

“Major resistance continues to be seen at .7518/42 (this is the location of the previous 43 year uptrend, which should now act as resistance and the 2013-2015 downtrend). We will maintain our bearish view while capped here”.

In the opinion o Axel Rudolph, Senior Technical Analyst at Commerzbank, the door remains open for a visit of the 0.7057 level…

(Market News Provided by FXstreet)

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