Today our focus will remain on Europe as we take a look at the EUR/GBP currency pair. The pair peaked last week but is now once again on the downturn.
The British pound has stabilized somewhat over the past week. Brexit is just around the corner, but investors appear confident in the sterling on the hopes that the European Union will give in to Theresa May’s demands about revising the Irish backstop conditions. The EU has denied all of these reports and have repeatedly stated that what was agreed on is binding, but right now investors appear to be optimistic about a Brexit deal.
The European single currency is unable to find incentives for growth right now. Recent fundamentals have been disappointing as the eurozone has been hit by the same lower growth concerns that have persisted globally in 2018. The trade wars and the political problems, as well as the relatively low risk appetite have really taken a toll on the euro. Moreover, the European Central Bank is considering another QE program to help promote spending and rising inflation, and such soft monetary policies will definitely weaken the EUR further.Today we expect an important announcement from the ECB that will likely have an impact on the pair.
In terms of the daily chart, today we have a pivot point for the pair located at 0.8696, with the pair currently trading below it. The daily support levels lie at 0.8677 and 0.8655. The daily resistances are at 0.8718 and 0.8737. The indicators of technical analysis and moving averages are giving us a strong sell recommendation.
