EUR/GBP Keeps Lows Near 0.7750

EUR/GBP Keeps Lows Near 0.7750

2 June 2016, 15:22
Roberto Jacobs

EUR/GBP Keeps Lows Near 0.7750

EUR/GBP’s price action remains depressed on Thursday following the press conference by President M.Draghi.

EUR/GBP gains capped near 0.7780

The cross keeps the bearish note following increasing volatility in the single currency in contrast with strong gains from the British pound, prompting the cross to surrender part of the recent important advance and re-test the mid-0.7700s.

President Draghi has revised higher the central bank’s projections for inflation and growth for the current year, now seen at 0.2% and 1.6%, respectively. Furthermore, Draghi reiterated growth risks remain tilted to the downside, adding that growth in Q2 could see a slower pace.

Regarding the upcoming UK-EU Referendum, Draghi emphasized that both the UK and the EU should benefit from a ‘Remain’ win.

EUR/GBP key levels

The cross is now retreating 0.31% at 0.7739 and a breakdown of 0.7562 (low May 25) would expose 0.7534 (200-day sma) and finally 0.7310 (low Jan.5). On the other hand, the next hurdle lines up at 0.7798 (100-day sma) ahead of 0.7851 (55-day sma) and then 0.7947 (2016 high May 4).


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