EUR/GBP attempts recovery after weak UK data

The recovery in the EUR/GBP pair is gathering pace after the UK trade deficit figure printed higher than estimates, while manufacturing production contracted sharply.

Trades around 0.8070

The cross hovers around 0.8070 from the pre-data level of 0.8050 as Cable trimmed gains after manufacturing production in February fell far more than expected – 1.1% m/m and 1.8% y/y. Furthermore, UK’s goods trade deficit also rose more than expected to GBP 11.964 billion.

The pair fell to a session low of 0.8047 ahead of the data release as GBP/USD rose to 1.4141 levels amid oil price rally and resulting risk-on in equities.

EUR/GBP Technical Levels

Acceptance above the immediate hurdle at 0.8077 (hourly 50-MA) would open doors for a re-test of 0.81 handle. Next major resistance stands at 0.8117 (Apr 7 high). On the other hand, a breakdown of immediate support at 0.8042 would shift risk in favor of a drop to 0.80. A violation there would expose 0.7975 (hourly 200-MA).