- The EUR/GBP cross-currency tumbled since Tuesday close to 200 pips.
- Fragile market mood shows investors’ nervousness in an uncertain scenario.
- EUR/GBP Price Analysis: Pressured around the 200-day EMA; once cleared, a fall towards 0.8300 is on the cards.
On Friday, the EUR/GBP trims some of Thursday’s losses, though braced for the confluence of the 100 and 200-day EMAs around 0.8440-44 during the North American session. At 0.8455, the EUR/GBP is up by a minimal 0.10%.
US equities wobble, reflecting a downbeat market mood. The EU’s energy crisis linked to Russia’s invasion of Ukraine, and signs of EU economic contagion or even contraction, weigh heavily in the shared currency, particularly in the EUR/GBP pair. Meanwhile, BoE’s Pill and Mann expressed the need for faster rate hikes in the UK amidst the resignation of UK’s Prime Minister Boris Johnson.
In the meantime, the cross-currency opened near 0.8445 and slid towards the daily low below 0.8440 before printing the daily high at 0.8475.
EUR/GBP Daily chart
The EUR/GBP is about to change its bias, due in part to fundamental reasons attached to a Euro area economic slowdown, but also for the presence of the 200-day EMA just 12 pips below the current exchange rate. The EUR/GBP fall from 0.8600 to current price levels shifted the Relative Strength Index (RSI) to bearish conditions, meaning that selling pressure lies ahead.
Therefore, the EUR/GBP bias in the near term is neutral but slightly tilted to the downside. Break below the 200-day EMA will expose the 0.8400 figure. Once cleared, EUR sellers’ next stop will be the May 2 swing low at 0.8367, followed by the 0.8300 figure.
EUR/GBP Key Technical Level
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