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Forex pairs in this Article » EUR/GBP
FXstreet.com (Athens)- The EUR/GBP is heading upwards despite the dismal data released from the Euro land power horse.

EUR/GBP heading on the upper level, as Mario… ‘dangles the carrot’


Despite the fact that the German IFO missed expectations, it was released higher for a fifth straight month. However, it fell shy of the consensus forecast of 108.2 as it was announced at 107.7 from 107.6, the previous month. Still, the single currency is mainly boosted on Mario Draghi’s yesterday position on behalf of ECB. The top person of the ECB, mentioned that “the ECB is prepared to do more if needed, including another LTRO, has been said before. . Elaborating on, this could be well translated as that the ECB may have little choice but to further embark on its easing cycle as the governments operating under the monetary union become increasingly reliant on monetary support and could not help move on without this support.

Technical Analysis and Strategic Bias on EUR/GBP

Karen Jones, Head Technical Analyst at Commerzbank suggests that the “EUR/GBP has held below the initial resistance at 0.8470 (June low). The market last week charted a key day reversal, RSI divergence and a 13 count and is expected to see more of a follow through rally into this week. This is viewed as merely a correction of the recent sharp sell off, which has been evident since the beginning of August. Any rebounds will find initial resistance at the June low at .8470 and the 38.2% retracement at .8500. We would allow for a rally towards as far as the 2 month downtrend at .8536, but then look for that to cap. Longer term the market has reversed from the top of a 4 year channel and longer term downside targets of .8280/.8155/.7980 have been introduced (Fibonacci retracements of the move up from 2012).”
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