EUR / GBP jumps away from 2022 lows and remains stable around 0.8360

  • The EUR / GBP advanced during the American session, rising 0.18%.
  • Inflation in the euro area increased more than expected, reaching the 5% level.
  • EUR / GBP Technical Outlook: Bearish bias as long as it remains below 0.8500.

The EUR is up for the third day in a row against the British pound, with inflation figures for the euro zone higher than expected. EUR / GBP is trading at 0.8361 during the American session at press time.

The HICP of the euro area for December exceeds the 5% level

On Friday the economic agenda of the euro zone presented inflation figures. The December HICP increased by 5.0% in its annual rate, higher than the 4.7% estimated by analysts. The jump in the figure is attributed to high energy prices, which were up 26% compared to 2021. However, increases in imported food, services and goods also exceeded the European Central Bank’s 2% target.

EUR / GBP Forecast: Technical Outlook

EUR / GBP portrays its inability to break below the yearly low at 0.8335 twice, once in Friday’s session. However, the daily moving averages (DMA) are positioned 90 pips above the price, confirming the bearish bias of the pair.

The first resistance of the EUR / GBP would be a resistance trend line drawn from the January 5 highs, which converges near the R1 daily pivot point around the 0.8366-72 region. A break out of that area would expose the 200 hourly SMA at 0.8380, followed by the daily pivot R2 at 0.8386.

On the other hand, the first support level for EUR / GBP would be the 100 hourly SMA at 0.8356, once broken it would expose the 50 hour SMA at 0.8350, followed by the daily S1 pivot at 0.8334.

Additional technical levels

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