EURGBP retreat from daily lows as the euro makes a comeback after the second reading of Eurozone GDP came in at -12.1% in line with expectations. Eurozone June trade balance came in at €17.1 billion topping the expectations of €14.5 billion as the exports grew by 11.1% and the imports grew by 5.7%. The Eurozone Employment Change came in at -2.9%, below the expectations of -1.7% in the second quarter.
Eurozone shows some signs of economic recovery while the previous week, the UK GDP contracted by 20.4% in the 2Q of the year, after a contraction of 2.2% in the 1Q. The GDP data came slightly better than analyst’s estimates of a 20.5% contraction. UK GDP contraction came worst than the Eurozone GDP contraction as the GDP second reading reaffirmed the contraction of 12.1% in the second quarter.
The common currency managed to return above the 50-day moving average after a pullback back to 0.90 zone. Even the British pound keeps the positive momentum after the previous week, the Bank of England (BOE) kept the interest rates at historic low levels at 0.10% but raised the forecasts for the UK economy.
EURGBP Daily Technical Analysis
EURGBP managed to pair early loses and as of writing returned to the unchanged level as the bulls managed to regain the 50-day moving average. The pair is hovering around the 50-day SMA the last two weeks as the bears and bulls fighting to control that level.
Support for EURGBP is at 0.9000 today’s low. The next support zone stands at 0.8983 the low from August 12. The 100-day moving average at 0.8923 would provide the next support zone.
On the other side, the initial resistance stands at 0.9048 the daily high. More sellers would emerge at 0.9081 the high from July 31. The recent high from 9147, would provide the next supply zone.