Yesterday’s trade saw EUR/GBP within the range of 0.7383-0.7450. The daily low has also been the lowest level in more than six years. The pair closed at 0.7438, gaining 0.23% on a daily basis.
At 7:45 GMT today EUR/GBP was down 0.09% for the day to trade at 0.7432. The pair touched a daily low at 0.7418 during early Asian trade.
Fundamentals
Euro area
Industrial output
The seasonally adjusted index of industrial production in the Euro zone probably expanded 0.2% in December compared to a month ago, following another 0.2% gain in November. If so, this would be the fourth consecutive month of production growth. Annualized output probably increased at a pace of 0.3% in December, after a 0.4% contraction in November. The index, reflecting business cycle, measures the change in overall inflation-adjusted value of output in sectors such as manufacturing, mining and utilities. In case industrial output expanded more than anticipated, this would support demand for the common currency, as this boosts the probability of a higher inflationary pressure. Eurostat is to publish the official data at 10:00 GMT.
United Kingdom
Bank of England Inflation Report
At 10:30 GMT Bank of England is scheduled to publish its quarterly report, containing inflation rate and economic growth projections in regard to the next two years. In case the report shows a hawkish outlook, this usually provides support to the national currency, while a dovish outlook usually has a bearish effect on the pound.
Pivot Points
According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 0.7424. In case EUR/GBP manages to breach the first resistance level at 0.7464, it will probably continue up to test 0.7491. In case the second key resistance is broken, the pair will probably attempt to advance to 0.7531.
If EUR/GBP manages to breach the first key support at 0.7397, it will probably continue to slide and test 0.7357. With this second key support broken, the movement to the downside will probably continue to 0.7330.
The mid-Pivot levels for Monday are as follows: M1 – 0.7344, M2 – 0.7377, M3 – 0.7411, M4 – 0.7444, M5 – 0.7478, M6 – 0.7511.
In weekly terms, the central pivot point is at 0.7477. The three key resistance levels are as follows: R1 – 0.7541, R2 – 0.7659, R3 – 0.7723. The three key support levels are: S1 – 0.7359, S2 – 0.7295, S3 – 0.7177.
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