EUR/GBP Breaks Through 0.7900 Support
Yet another weak UK PMI reading failed to boost the EUR/GBP pair, which has now dropped below 0.7900 support to currently trade at day's low level of 0.7885.
The UK services PMI, released just a while ago, continued to point towards deteriorating activity across various sectors of the economy. The Markit/CIPS UK services PMI decelerated further to 52.0 in April, down from 53.7 measured in March, and below estimate of 53.5.
Despite weaker PMI readings, the relative strength of the British Pound dragged the pair lower to nearly test 0.7880 intermediate support, marking 38.2% Fibonacci retracement level of 0.8117-0.7735 downfall.
Technical levels to watch
Weakness below 0.7880 intermediate support is likely to take support at 50-day SMA region, near 0.7865 level. Subsequent weakness below 50-day SMA would now negate possibilities of any further up-move and drag the pair back below 0.7800 level towards testing its next major support near 0.7780 area.
On the flip side, 0.7900 level now seems to attract fresh offers till 0.7925 resistance (50% Fibonacci retracement level). A follow through buying interest above 0.7925 now seems to assist the pair to surpass Wednesday's high of 0.7940 and head towards testing its next major resistance near 0.7970 level, coinciding with 61.8% Fibonacci retracement level.