EUR/GBP Drops Further to 0.7940, GBP Regains Momentum
The cross in the EUR/GBP reversed
a spike and dropped sharply to daily lows as the pound picked-up
significant strength against its European counterpart, despite weak
EUR/GBP offered once again near 0.7970
Currently, the EUR/GBP pair trades -0.20% lower at fresh session lows of 0.7940, with the upside capped by 20-DMA at 0.7970. The EUR/GBP cross came under renewed selling pressure as the EUR/USD pair kept the red following the release of downbeat Euro zone trade balance data. The region’s trade surplus shrunk to €19.0 billion, down from €20.0 billion in February 2015.
While the bearish pressure on the cross can be largely attributed to the fresh buying interest seen around the cable amid rising demand for higher-yielding currencies, as markets look past a non-event BOE policy decision and also choose to ignore the dismal construction output data from the British economy.
Later today, the cross will get influenced by the US industrial production and consumer sentiment data which will be published in the NA session.
EUR/GBP Technical Levels
To the upside, the next resistance is located at 0.8000 (round numbers), above which it could extend gains to 0.8021/19 (10-DMA/ 1h 200-SMA). To the downside immediate support might be located at 0.7925 (Apr 13 Low) below that at 0.7907/00 (daily S3/ round number).
(Market News Provided by FXstreet)