EURGBP Stalled at 200-Day Moving Average as Bulls Run Out of Steam

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The EUR to GBP retreat today after the stronger United Kingdom Construction PMI showing that the construction sector activity in the UK unexpectedly expanded. The construction PMI came in at 52.6 topping the expectations of 48.8 in February. The January reading was at 48.4.

The European Monetary Union Unemployment Rate came in at 7.4% in line with expectations for January. The European Monetary Union Consumer Price Index (CPI) came in at 1.2% in line with estimates for February.

The pair rejected for the second day in a row at the 200-day moving average, thus questioning the recent strong rebound from the four month lows. The euro was on the bid yesterday against the British pound after stronger manufacturing PMI’S from the European Monetary Union and Germany. The Manufacturing PMI in the European Monetary Union came in at 49.2 above the market consensus of 49.1 in February. The February manufacturing PMI in Germany came in at 48 above the forecasts of 47.8 for February.

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EURGBP Technical Analysis

EURGBP is 0.41% lower at 0.8689 as the rebound from the four month lows stalled at the 200-day moving average. EURGBP pierced above the descending trendline that began in early October 2019, and rallied breaking aboe the 50 and 100-day mnoving average. The momentum is positive now for the EURGBP while a break above the 200-day moving average might initiate another leg higher.

On the downside, immediate support for the EURGBP stands at 0.8682 the daily low. Next level of support is at 0.8593 the low from March 2. The 100-day moving average at 0.8512 would provide the next support zone.

On the flip side, the daily top at 0.8740 will be the first resistance area. A break above might test the next hurdle at 0.8811 the high from October 14th, 2019. The next resistance zone will be met at 0.8869 the high from October 11th, 2019.

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