After a flat hospitable the week, Sterling is popping lower across the board as traders step back from GBP-risk. Three events will dominate sentiment in the week , starting later today when UK PM Boris Johnson announces details of the preliminary steps the united kingdom must fancy start rolling back the present COVID-19 lockdown measures. The Prime Minister’s speech on Sunday was vague and lacking in content and he now must provide more details about the way forward. Also today, the EU and UK will have another, virtual, meeting to debate future trade agreements between the 2 parties. As we stand, each side are sticking to their respective red lines and therefore the rhetoric between the 2 is becoming increasingly tense. each side will got to move to stop the EU and UK trading on WTO terms from January 1, 2021.
The preliminary check out UK Q1 GDP is released on Wednesday and can show the initial impact of the coronavirus on the UK’s economy. the discharge will show the expansion contracting within the UK within the half-moon and this data is probably going to urge even worse in Q2 and possibly Q3. Sterling’s upside will remain limited.
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EURGBP remains stuck during a two-point rangeand will need a robust driver to enable a breakout. A short-term series of upper lows helps to lift the pair above mid-range and EURGBP may test resistance if it can close above the 61.8% Fibonacci and therefore the 20-dam, both at 0.8747.
EUR/GBP Daily Price Chart (October 2019 – May 11, 2020)
EUR/GBP MIXED Data provided by of clients are net long.
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GBP/USDis eyeing last week’s 1.2262 low and may re-test this level soon. Below here, 1.2247 needs to hold to prevent further losses. Lowe highs continue to dominate recent price action.