EUR/GBP consolidating around 0.7800

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 17, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    The pound is practically unchanged against the euro on Wednesday. EUR/GBP peaked at 0.7844, the highest level in six days but then bounced to the downside and bottomed at 0.7760.

    During the last hours, it has been trading steady, in a range with support at 0.7760 and resistance around 0.7800.

    Economic data from the UK released today from the labor market showed a mixed picture. The unemployment rate remained steady against expectations of a decline but wage growth rose above consensus at 2% over the last 12 months.

    “With wage pressures remaining fairly subdued (at least for now) and headline inflation likely to remain low in the near-term, the Bank of England has room to leave rates unchanged until the Brexit uncertainty subsides. However, if the UK votes to remain in the EU, we think there is a strong chance of a November rate hike given that consumer spending remains strong and a weaker sterling is likely to help push up inflation in the medium-term”, said James Smith, Economist at ING.

    EUR/GBP technical levels

    To the upside, resistance level might be located at 0.7815 (Feb 16 high), 0.7850 (Feb 09 high) and 0.7890 (Feb 11 high). On the opposite direction, support could be seen at 0.7760 (daily low), 0.7710 (Fed 10 low), 0.7695 (Feb 15 & 16 low) and 0.7680 (20-day MA).
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