20 Jul 2015
EUR/GBP funda/tech's are a sell on rallies
FXStreet (Guatemala) - EUR/GBP is currently trading at 0.6960 with a high of 0.6977 and a low of 0.6936.
EUR/GBP supply is coming back in here after a minor recovery attempt vs the broader downtrend from the 0.72 handle.
EUR/GBP bearish price action and technical levels
EUR/GBP has been better bid since the 0.72 handle below this months highs at 0.7222. A sell on rallies leaves the pair in bearish territory now trading below June's bearish gaps lows at 0.6986 which now acts as resistance. The end of last week was relatively flat on dollar strength where the pair traded around the lowest levels since 2007. At this juncture, we are facing the long term channel between here and 0.6533 commencing 2003 until Dec 2007 of which boundaries should provide strong support while 0.6770 swing trade levels of same channel comes as bears target. However, according to Karen Jones, Head of FICC Technical Analysis at Commerzbank, the cross could see a small rebound in the near term.
EUR/GBP fundamentals on BoE, ECB and Greece
EUR/GBP is weighed by sentiment for a BoE rate hike and the divergence between the ECB and BoE. As per the latest Reuters survey 60% of respondents see a UK rate hike coming by the end of Q1 2016, up from 55% in the last poll.
This week brings the July MPC minutes and votes which could be of interest post Carney's recent hawkish rhetoric, and this vs the backdrop of the ECB's recent meeting and dovish comments from President Draghi at the press conference, when last week he reiterated that the ECB remains committed to its full-scale QE, could all weigh on the cross further.
Meanwhile, in respect of Greece, the air has settled now that progress is being made between the two parties of creditors/EU leaders and Greece. Today, Greece met their payment in arrears of about 2b EUR to the IMF and is therefor no longer in arrears to them. Also, Greek banks reopened today.
However, there remains an air of scepticism in respect of the bailout package and how this will be negotiated between all EU leaders in agreement and Greece being committed to meet such reforms that have been required of them. The former Greek Finance Minister Yanis Varoufakis telling the BBC over the weekend that economic reforms imposed on his country by creditors are "going to fail", ahead of the talks on the huge bailout, adding, Greece was subject to a programme that will "go down in history as the greatest disaster of macroeconomic management ever".
EUR/GBP supply is coming back in here after a minor recovery attempt vs the broader downtrend from the 0.72 handle.
EUR/GBP bearish price action and technical levels
EUR/GBP has been better bid since the 0.72 handle below this months highs at 0.7222. A sell on rallies leaves the pair in bearish territory now trading below June's bearish gaps lows at 0.6986 which now acts as resistance. The end of last week was relatively flat on dollar strength where the pair traded around the lowest levels since 2007. At this juncture, we are facing the long term channel between here and 0.6533 commencing 2003 until Dec 2007 of which boundaries should provide strong support while 0.6770 swing trade levels of same channel comes as bears target. However, according to Karen Jones, Head of FICC Technical Analysis at Commerzbank, the cross could see a small rebound in the near term.
EUR/GBP fundamentals on BoE, ECB and Greece
EUR/GBP is weighed by sentiment for a BoE rate hike and the divergence between the ECB and BoE. As per the latest Reuters survey 60% of respondents see a UK rate hike coming by the end of Q1 2016, up from 55% in the last poll.
This week brings the July MPC minutes and votes which could be of interest post Carney's recent hawkish rhetoric, and this vs the backdrop of the ECB's recent meeting and dovish comments from President Draghi at the press conference, when last week he reiterated that the ECB remains committed to its full-scale QE, could all weigh on the cross further.
Meanwhile, in respect of Greece, the air has settled now that progress is being made between the two parties of creditors/EU leaders and Greece. Today, Greece met their payment in arrears of about 2b EUR to the IMF and is therefor no longer in arrears to them. Also, Greek banks reopened today.
However, there remains an air of scepticism in respect of the bailout package and how this will be negotiated between all EU leaders in agreement and Greece being committed to meet such reforms that have been required of them. The former Greek Finance Minister Yanis Varoufakis telling the BBC over the weekend that economic reforms imposed on his country by creditors are "going to fail", ahead of the talks on the huge bailout, adding, Greece was subject to a programme that will "go down in history as the greatest disaster of macroeconomic management ever".