The EUR to GBP (EURGBP) pair is falling today as traders react to the weak economic data from the Eurozone. The pair is trading at 0.9042, which is the lowest it has been since Tuesday this week. The euro has also weakened against the US dollar and other currencies.
The EURGBP pair is reacting to weak GDP data from Germany. Data from the statistics office showed that the economy contracted by 11.7% year-on-year in the second quarter in which was the worst performance on record. In contrast, the economy contracted by slightly below 5% at the peak of the Global Financial Crisis.
The EUR to GBP pair is reacting to the mixed sentiment and unemployment rate data from Europe. The unemployment rate for the eurozone rose to 7.8% in June from the previous 7.7%. In July, sentiment in 26.1.
Later today, the EURGBP pair will react to the preliminary consumer price index data from Germany.
EURGBP technical forecast
The daily chart below shows that the EURGBP pair has been in a downward trend for the past few days. The price is slightly above the 50-day and 100-day exponential moving averages. Also, the price is below the lower line of the ascending channel that is shown in purple.
Besides, the EUR to GBP pair has just moved below the 61.8% retracement level. Therefore, I expect the pair to continue falling as bears target the next support level at 0.900. This is an important psychological level and also the 50-day EMA.
On the flip side, if the EURGBP moves back to the ascending channel at around 0.9150, it will signal that there are more buyers in the market who will be keen to push it higher.
EUR to GBP forecast