EUR/GBP erases gains and returns below 0.8300

• Central banker’s comments and data help the euro, but it loses steam.
• EUR/GBP pulls back after hitting one-week highs, nears short-term support.

The EUR/GBP lost steam in the last few hours and erased daily gains. The euro had climbed to 0.8335, hit the highest level in a week but then erased the rally. The cross is trading at 0.8295, in neutral territory for the day.

EUR/GBP gains had been driven by Eurozone data, comments from European Central Bank officials and an acceleration in the correction to recent moves. But more recently, reports of possible bans on Russian oil seem to have backfired.

Hours ago on Wednesday, it became known that wholesale inflation in Germany rose more than expected in March, with an increase of 4.9% (30.9% annual). Another report showed that in the Eurozone, industrial production rose 0.7% in February (2% annual).

In turn, there were more voices trying to overshadow Christine Lagarde’s “dosivsh” speech last week. Martins Kazaks mentioned the possibility of an interest rate hike “as early as July”.

More recently, the press reported that the The European Union is preparing for the impact that a ban on Russian oil would have. Germany remains the main opponent of an oil embargo.

Still bullish, but more risky

The EUR/GBP pullback took away momentum and puts the very short-term bullish bias in jeopardy. On the downside is the support at 0.8285/90, where you can find a short-term bullish line, horizontal support, and the 20 SMA on the 4-hour chart. A break of that level would change the bias to neutral/bearish, exposing the week’s low at 0.8265.

Technical levels