EUR/GBP aims for 1-week high amid renewed GBP weakness

• Fears of no-deal Brexit, absence of major catalysts weaken the British Pound (GBP) ahead of the key UK event.
• Fewer data/events from Eurozone highlight the Fed speeches, global political plays as directives.

Although latest rhetoric from the Fed has mostly triggered the Euro’s (EUR) profit-booking, the regional currency manages to benefit from the GBP weakness as the EUR/GBP pair takes the rounds to 0.8960 heading into Europe open on Wednesday.

With the US Federal Reserve policymakers scaling back their previous bearish threats, the EUR repeated its tendency to lose while the US Dollar (USD) rises. Though, threats of hard Brexit from the frontrunner of the UK Prime Minister’s post Boris Johnson and disappointing British CBI Retail Sales survey results continue making the region currency a gainer versus its UK counterpart.

Moving on, except Germany’s GfK Consumer Climate Index, there aren’t any major data/events scheduled for publishing from the Eurozone while quarterly testimony on the inflation report by the Bank of England (BOE) officials will be the crucial event from the UK.

German consumer sentiment gauge is expected to remain modestly flat with 10.1 mark versus 10.0 prior. On the contrary, BOE officials might emphasize more on the recent bearish rhetoric from major central banks and challenges to the Brexit in spite of focusing more on the 2-month old inflation report.

Technical Analysis

June 18 high around 0.8976 holds the door for the pair’s run-up to 0.9000 round-figure whereas 0.9065, 0.9100 and the year to date top surrounding 0.9120 can please buyers afterward.

During the pullback, 0.8930 and 21-day simple moving average (21-day SMA) around 0.8885 will entertain the counter-trend traders ahead of challenging them by 0.8840 and 200-day SMA level of 0.8783