FXStreet (London) - While not often seen as the most exciting pair EUR/GBP has been testing multi year lows this morning, steadily declining through the European session from its overnight high at 0.8065 to post a multi year low at 0.8033, just pips below its current position at 0.8040.
This morning has seen better than expected Eurozone Industrial Production numbers which aided the leg lower. Meanwhile, the ECB monthly bulletin communicated that the risks of outright deflation in the region remained remote but too prolonged low inflation may require a policy response. Peter Fell of FXBeat comments that Goldman Sach analysts believe that there is plenty of room for further EUR downside ahead and are targeting the 0.76-0.70 range.
Currently, EUR/GBP is trading at 0.8044, down -0.19% on the day, having posted a daily high at 0.8067 and low at 0.8031. Daily RSI is approaching oversold territory at 28.44 while daily standard volatility is at 101 pips and expanding.
With spot trading at 0.8045, we can see next resistance ahead at 0.8045 (Daily Classic S1), 0.8052 (Yesterday's Low), 0.8054 (Hourly 20 EMA), 0.8060 (Monthly Low) and 0.8060 (Weekly Low).Support below can be found at 0.8031 (Daily Low), 0.8030 (Daily Classic S2), 0.8022 (Weekly Classic S2), 0.8009 (Daily Classic S3) and 0.7982 (Weekly Classic S3). Looking to candlestick patterns, we can see a Hammer formation on the 4-hour chart .