- Euro bounces and erases losses against the pound.
- EUR / GBP remains sideways after failing to sustain above 0.8700 at the close of last week.
EUR / GBP is trading around 0.8660, showing a slight gain from Friday’s close. The cross is having a volatile day and is moving without a clear direction.
In European hours, EUR / GBP fell to 0.8629, the lowest level since April 8. After holding above 0.8630, the euro undertook a strong recovery reaching 0.8672, a high for the day.
The movements in the market on Monday are driven by the weakness of the dollar. The greenback is falling on all fronts and the different rate of rise of the EUR / USD and GBP / USD explains the movements of the EUR / GBP at the moment.
With no relevant economic data to be released on Monday, what happens to the dollar may continue to set the agenda. During the week, one of the most relevant events will be the meeting of the European Central Bank on Thursday, which is not expected to change the interest rate, but its announcement will be relevant.
From a technical point of view, EUR / GBP shows a slight bearish bias on the four-hour chart, which could change in the event of a rally above 0.8680, putting the euro on the path to retesting the important resistance at 0.8700. To the downside, the 0.8635 / 30 support is holding down the downs; should it give way, a bearish extension would be expected with a possible target around 0.8600.
Technical levels
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