EURGBP RETRACES
FUNDAMENTAL VIEW
On Monday, December 16, 2024, Eurozone data showed mixed results. French manufacturing PMI fell short of expectations, recording 41.9 compared to a forecast of 43.2, while service PMI improved to 48.2, surpassing the 46.9 forecast. Similarly, Germany reported manufacturing PMI at 42.1 against an expected 43.1, while service PMI outperformed, coming in at 51.4 compared to 49.5.
While In the UK, PMI data also reflected mixed outcomes. Manufacturing PMI registered 47.3, below the 48.4 forecast, while service PMI came in stronger at 51.4, beating the 50.9 forecast. As a result, EUR/GBP retraced during the European session, currently down 0.27% daily and weekly and 0.04% monthly.
Looking ahead of the week, key UK data releases include:
• Tuesday, December 17th 11:00 AM GMT+4: Claimant Count Change (forecast: 28.2k).
• Wednesday, December 18th 11:00 AM GMT+4: CPI y/y (expected increase of 0.3%).
• Thursday, December 19th: Interest rate decision (forecast: maintained at 4.75%).
• Friday, December 20th: Retail sales m/m.
These releases could significantly impact market movements
TECHNICAL VIEW:
EUR/GBP was in a broader downtrend but recently broke above the red trendline following last week’s impulsive move. The pair is currently retracing and moving toward the 32.8% Fibonacci retracement level at 0.8286, which aligns with the broken trendline providing a strong confluence zone. If this level is cleared, the next potential targets are the 50% Fib level at 0.8274, followed by the 61.8% level at 0.8263. Conversely, the pair could aim the previous peak at 0.8327 and possibly 0.8355. More so, price is currently trading above EMA 50. Breakout of these zones isn’t ruled out.
On Monday, December 16, 2024, Eurozone data showed mixed results. French manufacturing PMI fell short of expectations, recording 41.9 compared to a forecast of 43.2, while service PMI improved to 48.2, surpassing the 46.9 forecast. Similarly, Germany reported manufacturing PMI at 42.1 against an expected 43.1, while service PMI outperformed, coming in at 51.4 compared to 49.5.
While In the UK, PMI data also reflected mixed outcomes. Manufacturing PMI registered 47.3, below the 48.4 forecast, while service PMI came in stronger at 51.4, beating the 50.9 forecast. As a result, EUR/GBP retraced during the European session, currently down 0.27% daily and weekly and 0.04% monthly.
Looking ahead of the week, key UK data releases include:
• Tuesday, December 17th 11:00 AM GMT+4: Claimant Count Change (forecast: 28.2k).
• Wednesday, December 18th 11:00 AM GMT+4: CPI y/y (expected increase of 0.3%).
• Thursday, December 19th: Interest rate decision (forecast: maintained at 4.75%).
• Friday, December 20th: Retail sales m/m.
These releases could significantly impact market movements
TECHNICAL VIEW:
EUR/GBP was in a broader downtrend but recently broke above the red trendline following last week’s impulsive move. The pair is currently retracing and moving toward the 32.8% Fibonacci retracement level at 0.8286, which aligns with the broken trendline providing a strong confluence zone. If this level is cleared, the next potential targets are the 50% Fib level at 0.8274, followed by the 61.8% level at 0.8263. Conversely, the pair could aim the previous peak at 0.8327 and possibly 0.8355. More so, price is currently trading above EMA 50. Breakout of these zones isn’t ruled out.
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