EUR/GBP Ticks Below 0.7900 Ahead of UK PMI
pair dipped marginally below 0.7900 handle as investors now await for
the release of UK construction PMI for further trading cues.
Tuesday's disappointing UK manufacturing PMI dragged the British Pound lower against most major currencies. The relative GBP weakness assisted the pair to surpass 50-day SMA resistance near 0.7865-70 area and test 0.7920 resistance marking 50% Fibonacci retracement level of the pair's corrective move from April highs of 0.8117 to April low of 0.7735.
Today's UK economic calendar features the release of construction PMI figure for the month of April. A disappointing number, over and above Tuesday's weak manufacturing PMI print, would set the stage for further depreciation of the British Pound, eventually lifting the pair back towards 0.7920 resistance area. Meanwhile, investors will also have a look at the Euro-zone final services PMI print for further building on to the pair's recent gains.
Technical level to watch
On the immediate downside, 38.2% Fibonacci retracement level near 0.7880 seems to extend some intermediate support. Weakness below 0.7880 support could accelerate the fall, back below 50-day SMA near 0.7870-65, towards its next major support at 23.6% Fibonacci retracement level near 0.7825 region.
On the flip side, momentum above 0.7900 handle, leading to break-through 50% Fibonacci retracement level resistance near 0.7920, now seems to open room for further near-term appreciating move for the pair.