EURGBP Defies Logic: Bullish Despite Weak UK Retail Sales

EURGBP trades weak despite weak UK retail sales. Intraday  bias  remains bullish  as long as support 0.8480 holds. It hits an  intraday high of 0.85512 and is currently trading around 0.85345.

In May 2025, UK retail sales underwent a marked and unexpected decline, dropping by 2.7% compared to the previous month—a notably steeper fall than the anticipated 0.5% decrease. This downturn contrasts sharply with April’s 1.3% increase, which had been supported by favorable weather conditions. On an annual basis, retail sales volumes fell 1.3% below levels seen a year earlier, a significant reversal from the 5.0% growth recorded in April. The contraction spanned multiple sectors, with food store sales experiencing the most pronounced decrease at 5.0%, alongside declines in non-food and department store categories. These trends suggest a renewed caution among UK consumers, highlighting concerns over the fragility of the nation’s economic recovery and posing potential implications for upcoming Bank of England policy decisions.

Technical Analysis

The pair is currently trading above 55 and 200- EMA and 365-EMA on the 4-hour chart.

Bearish Trend Confirmation: Any break below 0.8480 confirms an intraday bearish trend. A drop to 0.84425/0.8400/0.8378/0.8340/0.8300 is likely.

Near-Term Resistance:  The near -term resistance is around 0.8565. Any violation above will take the pair to 0.8605/ 0.8660/0.8765/0.8800.

Indicator Analysis (4-hour chart)

CCI (50): Bullish

Average Directional Movement Index:  Neutral

Trading Recommendation

It  is good to buy on dips around 0.8500 with SL around 0.8480  for a TP of 0.8605.