EUR/GBP Clocks Fresh 2-Week Highs on EZ PMIs

EUR/GBP Clocks Fresh 2-Week Highs on EZ PMIs

4 May 2016, 10:59
Roberto Jacobs

EUR/GBP Clocks Fresh 2-Week Highs on EZ PMIs

The cross in the EUR/GBP ran through fresh bids just below 0.79 handle in the last hour, and now extends higher to fresh two-week highs following the release of Euro zone final services PMI reports.

EUR/GBP unperturbed by weak PMIs

Currently, the EUR/GBP pair trades 0.10% higher near fresh 2-week highs of 0.7929, having found solid support near 0.7895 region. The cross accelerated to the upside largely on the back of fresh selling seen in the cable, as markets remain wary ahead of the UK construction PMI report due out shortly.

While a weak set of services PMI from Germany and the Euro zone had little impact on the cross, despite EUR/USD retreating further from 1.15 handle. Germany’s services PMI weakened to 54.5 points from 55.1 in March, slightly missing the expected 54.6 points. While the euro zone's April services reading reached 53.1, unchanged from March.

Next on focus for the cross remains the UK construction PMI reading, which is expected to disappointed markets, especially after the manufacturing PMI posted awful results the day earlier.

EUR/GBP Technical Levels

To the upside, the next resistance is located at 0.7948/50 (Mar 31 High/ psychological levels), above which it could extend gains to 0.8000 (round number). To the downside immediate support might be located at 0.7890/75 (daily pivot/ 5-DMA) below that at 0.7823/12 (10-DMA/ 1h 200-SMA).


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