EURGBP showed a nice recovery after weak UK retail sales. Intraday bias remains bullish as long as support 0.8220 holds. It hit a low of 0.82236 and is currently trading around 0.83078.
UK retail sales rose by 0.2% in November 2024, following a 0.7% decline in October, indicating a small recovery in consumer spending. However, this increase was below the expected 0.5%, showing that consumers remain cautious due to economic pressures. Sales growth was driven mainly by supermarkets and non-food stores, while clothing sales dropped by 2.6%, the worst in nearly three years. Additionally, online sales fell by 4.3%, the largest decline since March 2022, as more shoppers turned to in-store purchases. Analysts worry that the Christmas shopping season may not significantly boost overall economic growth due to rising prices and interest rates affecting consumer confidence.
Technical Analysis
The pair is currently trading above the 34- and 55-EMA on the 4-hour chart.
- Bearish Trend Confirmation: If the price stays below 0.8280, it will confirm an intraday bearish trend. A drop to 0.8260/ 0.8220 is likely.
- Near-Term Resistance: Current resistance is around 0.8325. If it breaks above, we could see movement toward 0.8340/0.8360/0.8380/0.845/0.8500. The bearish outlook would be invalidated only if the price goes above 0.8500.
Indicator Analysis (4-hour chart)
- CCI (50): Bearish
- Average Directional Movement Index: Neutral
Trading Recommendation
It may be wise to buy on dips around 0.8300, with a stop loss set at 0.8260 and a target price of 0.8435.
