Yesterday’s trade saw EUR/GBP within the range of 0.7069-0.7121. The pair closed at 0.7082, gaining 0.18% on a daily basis. At the start of Asian trade on July 5th, EUR/GBP fell to as low as 0.7056, which has been the lowest level since June 29th, when a daily low of 0.6981 was recorded.
At 7:16 GMT today EUR/GBP was down 0.03% for the day to trade at 0.7084. The pair touched a daily low at 0.7072 at 6:30 GMT.
Fundamentals
Euro area
EU Leaders Special Summit
Leaders and Finance Ministers from the 19 EZ Member States are expected to hold a special meeting today in order to seek resolution to the Greek debt crisis.
In a response to the Sunday referendum, German Chancellor Angela Merkel stressed that Greek policy makers were running out of time in their attempt to keep the country within the Euro area. “The last offer that we made was a very generous one,” Angela Merkel said yesterday at the Elysee Palace in Paris, cited by Bloomberg. “On the other hand, Europe can only stand together, if each nation takes on its own responsibility.”
Meanwhile, the period of bank closure in Greece has been extended through Wednesday. According to a Greek government official, who wished to remain anonymous, Greek PM Tsipras conducted a phone call with the European Central Bank President, Mario Draghi and requested the lifting of capital controls.
According to Bloomberg, during a conference call on Monday Euro region finance officials made a small step further towards bridging the gap between Greece and its trio of creditors.
United Kingdom
Manufacturing, Industrial Output
Annualized industrial production in the United Kingdom probably expanded 1.6% in May, according to market expectations, following a 1.2% gain during the preceding month. If so, this would be the fastest annual production growth rate since August 2014, when activity grew 2.2%. In monthly terms, industrial production probably shrank 0.2% in May, following three consecutive months of expansion. The index measures the change in the total inflation-adjusted value of production in sectors such as manufacturing, mining and utilities.
United Kingdom’s annualized manufacturing production, a short-term indicator which accounts for almost 80% of the nation’s industrial output, probably expanded 1.8% in May. If so, this would be the 21st consecutive month of output growth and also the fastest annual rate of increase since December 2014. In April manufacturing production rose at an annualized pace of 0.2%. In monthly terms, production probably increased 0.1% in May, according to the median estimate by experts, following a 0.4% drop in April. As it is a key component of the country’s Gross Domestic Product, in case manufacturing production expanded more than projected, this would have a bullish effect on the sterling. The Office for National Statistics (ONS) will release the official industrial report at 8:30 GMT.
Pivot Points
According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 0.7091. In case EUR/GBP manages to breach the first resistance level at 0.7112, it will probably continue up to test 0.7143. In case the second key resistance is broken, the pair will probably attempt to advance to 0.7164.
If EUR/GBP manages to breach the first key support at 0.7060, it will probably continue to slide and test 0.7039. With this second key support broken, the movement to the downside will probably continue to 0.7008.
The mid-Pivot levels for today are as follows: M1 – 0.7024, M2 – 0.7050, M3 – 0.7076, M4 – 0.7102, M5 – 0.7128, M6 – 0.7154.
In weekly terms, the central pivot point is at 0.7099. The three key resistance levels are as follows: R1 – 0.7209, R2 – 0.7279, R3 – 0.7389. The three key support levels are: S1 – 0.7029, S2 – 0.6919, S3 – 0.6849.
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