Chart - Courtesy Trading View
Spot Analysis:
EUR/GBP was trading 0.12% lower on the day at 0.8693 at around 11:20 GMT.
Previous Week's High/ Low: 0.8866/ 0.8608
Previous Session's High/ Low: 0.8731/ 0.8633
Fundamental Overview:
The British pound weakens on a hotter UK inflation release. The UK CPI data puts the BOE in a tough spot following the government's fiscal and political fiasco.
Data released by the UK Statistics showed the headline Consumer Price Index (CPI) refreshes a 30-year high with a 10.1% YoY figure versus 10.0% expected and 9.9% prior.
That said, looming recession risks might force the Bank of England to adopt a gradual approach towards raising interest rates.
Further, UK political uncertainty is seen as another key factor undermining the British pound, which, in turn, acts as a tailwind for the pair.
Technical Analysis:
- Price action capped below 21-EMA
- The pair has bounced off daily cloud and 110-EMA
- Stochs are on verge of rollover from oversold levels
- GMMA indicator shows major trend is neutral, while minor trend is turning bullish
Major Support and Resistance Levels:
Support - 0.8665 (55-EMA), 0.8595 (110-EMA)
Resistance - 0.8726 (21-EMA), 0.8774 (20-DMA)
Summary: EUR/GBP rangebound between 21 and 55 EMA. Break out on either side will show clear direction.
