23 Jul 2015
EUR/GBP: a choppy recovery up to key resistance
FXStreet (Guatemala) - EUR/GBP is currently trading at 0.7062 with a high of 0.7074 and a low of 0.6989.
Volatility is the theme today, with holiday season starting perhaps. EUR/GBP got a lift from the onslaught on the greenback and cable getting hit on poor retails for the UK economy. The euro was strong in european market in a minor recovery this week on to the 1.10 handle, following on from Asia's tentatively better bid environment when the notification from Greek lawmakers came in the early hours of Athens today (overnight in Europe) voting yes 229 and no 63 which secured enough votes to pass the second package of reforms for the bailout deal.
EUR/GBP rallied in tandem with the single currency from 0.6989 late Asia lows to 0.7027 before tailing back to 0.7016 and the opening in Europe on a bullish gap to 0.7030. From there we were bid until 0.7059 with a slight set back, 0.7041/45 (Tuesday's high) , until further demand took us to aforementioned highs in the US shift so far.
In respect of Greece, the EUR 86b package reforms have been approved in the last hour in Athens in order to repay the debts, recapitalize the banks and make interest payments and at the same time, the ECB has increased its emergency cash injection of EUR900m just hours before the voting took place. Once again there was unrest in athens as the public protested agains further austerity measures. The bailout negotiations start tomorrow. Meanwhile, the data today for the UK and July retails sales was worse than expected but better revisions was the saving grace. However, the Q2 data showed the weakest spending growth since records of 2013 Q1 YoY and Q3 2014 QoQ.
Technically a choppy recovery from 6-year channel base
The base of a 6 year channel at 0.6967 acts like a magnet and rallies are finding a tough time of a convincing break, leading to a chop while 0.7057/65 offers headwinds below the 0.7151 short term downtrend.
Volatility is the theme today, with holiday season starting perhaps. EUR/GBP got a lift from the onslaught on the greenback and cable getting hit on poor retails for the UK economy. The euro was strong in european market in a minor recovery this week on to the 1.10 handle, following on from Asia's tentatively better bid environment when the notification from Greek lawmakers came in the early hours of Athens today (overnight in Europe) voting yes 229 and no 63 which secured enough votes to pass the second package of reforms for the bailout deal.
EUR/GBP rallied in tandem with the single currency from 0.6989 late Asia lows to 0.7027 before tailing back to 0.7016 and the opening in Europe on a bullish gap to 0.7030. From there we were bid until 0.7059 with a slight set back, 0.7041/45 (Tuesday's high) , until further demand took us to aforementioned highs in the US shift so far.
In respect of Greece, the EUR 86b package reforms have been approved in the last hour in Athens in order to repay the debts, recapitalize the banks and make interest payments and at the same time, the ECB has increased its emergency cash injection of EUR900m just hours before the voting took place. Once again there was unrest in athens as the public protested agains further austerity measures. The bailout negotiations start tomorrow. Meanwhile, the data today for the UK and July retails sales was worse than expected but better revisions was the saving grace. However, the Q2 data showed the weakest spending growth since records of 2013 Q1 YoY and Q3 2014 QoQ.
Technically a choppy recovery from 6-year channel base
The base of a 6 year channel at 0.6967 acts like a magnet and rallies are finding a tough time of a convincing break, leading to a chop while 0.7057/65 offers headwinds below the 0.7151 short term downtrend.