Today our focus will remain on Europe as we take a look at the EUR/GBP currency pair. The pair has been steadily declining since the middle of the month.
The British pound continues to stabilize. The sterling was able to find more support on investors’ expectations that there will not be a hard Brexit happening. Despite British PM Theresa May failing to revise her proposed deal and failing to convince her fellow MPs to support it, now there is hope that the prime minister would postpone the exit of the United Kingdom from the EU past the March 29 deadline, rather than act rashly and leave without a deal. The GBP was able to rally on that news.
The European single currency continues to struggle to find proper support. Fundamentals remain disappointing and inflation is not growing as much as it needs to be. The European Central Bank looked poised to unveil another stimulus package to support the economy, but with negotiations between the United States and China going well, growth might improve on its own globally. Today we expect the CPI data from Germany, which will be key in determining whether the economic climate in Europe has improved or not.
In terms of the daily chart, today we have a pivot point for the pair located at 0.8557, with the pair currently trading below it. The daily support levels lie at 0.8517 and 0.8490. The daily resistances are at 0.8584 and 0.8624. The indicators of technical analysis and moving averages are giving us a strong sell recommendation.
