FxWirePro: EUR/GBP extends bounce off channel base, upbeat German industrial production buoys euro

Chart - Courtesy Trading View 

Spot Analysis:

EUR/GBP was trading 0.45% higher on the day at 0.8315 at around 08:40 GMT

Previous Week's High/ Low: 0.8382/ 0.8230

Previous Session's High/ Low: 0.8304/ 0.8202

Fundamental Overview:

The shared currency gained traction after official data showed on Tuesday that Industrial Production in Germany jumped more than expected in January. 

Upbeat data suggested that the manufacturing sector recovery is gathering steam in Eurozone’s economic powerhouse.

Germany's seasonally adjusted industrial output climbed by 2.7% MoM, the federal statistics authority Destatis said, vs. a 0.5% increase expected and 1.1% last.

On an annualized basis, the German industrial production dropped by 1.8% in January versus a 2.7% drop registered in December, missing expectations for a rebound by 4.2%.

Technical Analysis:

- EUR/GBP is extending bounce off channel base support

- Price action has broken above 5-DMA and is on track to test 21-EMA

- RSI is now biased higher, Stochs are on verge of rollover from overbought levels

- The pair is testing 200H MA resistance, break above will fuel further gains

Major Support and Resistance Levels:

Support - 0.8283 (5-DMA), Resistance - 0.8317 (200H MA)

Summary: EUR/GBP keeps scope for some gains. Close below channel base will buoy bears in the pair. Major support is seen at 200-month MA at 0.8197. Watch out for break above 200H MA for more gains.