8 Nov 2013
EUR/GBP reverts back to pre-UK data levels
FXstreet.com (Athens) – The EUR/GBP pared back almost all of its earlier gains on dismal UK data, indicating that the movement was nothing else, but a short-squeeze.
The EUR/GBP is getting slightly back to its prior levels around 0.8345 area. Elaborating on, the EUR/GBP spiked higher near 0.8360 area, as soon as the UK trade deficit rose more than estimated during September, climbing to £9.816 billion vs. £9.557 billion (revised) from the previous month. At the time of writing the cross has already pared back all of its gains, hovering again at its prior levels (before the UK budget release) at 0.8346. Thus, the uptrend movement of roughly 15 pips on the weak UK news, was in plain English short positions squeezed following UK data.
Technical Perspectives on the EUR/GBP
The EUR/GBP might need to overcome the obstacle of 0.8379 (hourly low of 6th of November) to be closer to 0.8428 (23.6% Fibonacci retracement of the downtrend movement of 0.8585-0.8379). On the downwards side, a crucial support also in psychological terms resides at the area of 0.8300 (daily low of 17th January, 7th November), which if breached could bring the cross under further pressure, near the 0.8285 level (50% Fibonacci retracement of the upwards movement of 0.7756-0.8815).
The EUR/GBP is getting slightly back to its prior levels around 0.8345 area. Elaborating on, the EUR/GBP spiked higher near 0.8360 area, as soon as the UK trade deficit rose more than estimated during September, climbing to £9.816 billion vs. £9.557 billion (revised) from the previous month. At the time of writing the cross has already pared back all of its gains, hovering again at its prior levels (before the UK budget release) at 0.8346. Thus, the uptrend movement of roughly 15 pips on the weak UK news, was in plain English short positions squeezed following UK data.
Technical Perspectives on the EUR/GBP
The EUR/GBP might need to overcome the obstacle of 0.8379 (hourly low of 6th of November) to be closer to 0.8428 (23.6% Fibonacci retracement of the downtrend movement of 0.8585-0.8379). On the downwards side, a crucial support also in psychological terms resides at the area of 0.8300 (daily low of 17th January, 7th November), which if breached could bring the cross under further pressure, near the 0.8285 level (50% Fibonacci retracement of the upwards movement of 0.7756-0.8815).