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EUR/GBP dips to fresh 3-month lows on UK PMI

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Nov 4, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - After having failed to resist 0.71 barrier earlier on the day, the cross in the EUR/GBP keeps pushing lower and now reached fresh three-month lows on the release of upbeat UK services PMI report.

    EUR/GBP trades below most major MAs

    Currently, the EUR/GBP pair trades -0.37% lower at 0.7084, keeping range near multi-month lows struck at 0.7078 post-data release. The cross accelerated losses after the pound spiked higher after the UK services sector activity rebounded in Oct.

    The UK services PMI ticked higher to 54.9 in October, rebounding from the previous month's 29-month low of 53.3, and beat consensus of 54.5.

    While a falling euro versus the US dollar on the back of divergent monetary policy outlooks also exacerbated the pain in EUR/GBP. Markets ignored upbeat Eurozone services PMI readings as focus now shifts towards Fed speaks and the US macro releases.

    EUR/GBP Technical Levels

    To the upside, the next resistance is located at 0.7100/03 (round number/ 1h 20-SMA), above which it could extend gains to 0.7123 (5-DMA). To the downside immediate support might be located at 0.7066/61 (daily S2/ Aug 17 Low) below that at 0.7036 (daily S3).
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