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EUR/GBP takes-out 0.7800 on UK PMI

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 2, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    The EUR/GBP cross regained momentum and now tests 0.72 handle, as the cable accelerated to the downside following downbeat UK construction PMI report.

    EUR/GBP catches fresh bid post-data

    Currently, the EUR/GBP pair trades 0.12% higher at fresh session highs of 0.7800, now eyeing a test of Tuesday’s high at 0.7824. The fall in the UK construction sector gauge yet again last month spurred fresh selling in the GBP/USD pair, and hence drove EUR/GBP to new session tops.

    The UK construction PMI unexpectedly fell again in February to 54.2, the weakest since April 2015. The PMI slowed from 55.0 booked in Feb, and missed estimates of 55.5.

    While the EUR/USD pair trades largely muted around 1.0860 levels and provide little support to the cross, as the EUR traders now await the US ADP employment report for fresh momentum on the major.

    EUR/GBP Technical Levels

    To the upside, the next resistance is located at 0.7824/34 (Mar 1 High/ 5-DMA), above which it could extend gains to 0.7898/0.7900 (Feb 29 High). To the downside immediate support might be located at 0.7762 (daily low) below that at 0.7721 (daily S2).
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