Key Moments:
- EUR/GBP last traded around 0.8670, remaining just above the 0.8650 support area that has repeatedly contained downside this month
- German GDP for the third quarter exceeded forecasts, but markets are waiting for broader Eurozone and German data to validate signs of improvement
- Price action is sitting on the neckline of a large bearish Head & Shoulders pattern, with key support at 0.8650 and resistance between 0.8700 and 0.8745
Fundamental Backdrop: Euro Under Pressure Despite German GDP Beat
EUR/GBP edged higher to 0.8670 but continues to trade close to a critical support band around 0.8650. The cross has been locked in a bearish trajectory since mid-November, with the Euro struggling to sustain any move above the 0.8700 handle earlier this week.
Stronger shop price inflation data in the UK and ongoing speculation about additional easing from the European Central Bank have weighed on the pair in recent sessions, reinforcing downward pressure on the Euro against the Pound.
On the data front, figures released from Germany on Friday showed that Gross Domestic Product grew more than anticipated in the third quarter, offering some near-term support to the common currency. Market participants are now looking to upcoming Eurozone GDP and German inflation releases for confirmation that the improvement in Germany is part of a broader regional upswing.
Technical Outlook: Neckline of Bearish Head & Shoulders in Focus
The daily EUR/GBP chart places the pair at 0.8670, only a short distance above the neckline of a sizeable Head & Shoulders pattern, located at 0.8650. This zone has acted as a pivotal floor, limiting declines several times in January.
Technical indicators reinforce the cautious tone. The Moving Average Convergence Divergence (MACD) is hovering flat around the zero line, while the Relative Strength Index (RSI) remains in bearish territory and has not managed to reclaim the key 50 threshold.
A decisive break below 0.8650 could encourage sellers to push for a test of the mid-August trough near the 0.8600 region. Should bearish momentum accelerate further, the next downside objective would be the late June low, located around 0.8515.
On the topside, initial resistance is clustered in the 0.8700-0.8710 band, corresponding to the highs registered on January 27 and 28. Above that, the next notable barrier is the January 21 peak at 0.8745.
(The technical analysis of this story was written with the help of an AI tool.)
Pound Performance Against Major Currencies This Week
The table below summarizes weekly percentage moves of the British Pound (GBP) versus other major currencies. Over the period, the Pound showed its strongest performance against the US Dollar.
| Base \ Quote | USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF |
|---|---|---|---|---|---|---|---|---|
| USD | — | -0.33% | -0.56% | -0.23% | -1.16% | -0.86% | -1.31% | -0.67% |
| EUR | 0.33% | — | -0.23% | 0.13% | -0.84% | -0.53% | -0.99% | -0.35% |
| GBP | 0.56% | 0.23% | — | 0.02% | -0.60% | -0.31% | -0.76% | -0.11% |
| JPY | 0.23% | -0.13% | -0.02% | — | -0.94% | -0.64% | -1.06% | -0.44% |
| CAD | 1.16% | 0.84% | 0.60% | 0.94% | — | 0.18% | -0.13% | 0.49% |
| AUD | 0.86% | 0.53% | 0.31% | 0.64% | -0.18% | — | -0.46% | 0.19% |
| NZD | 1.31% | 0.99% | 0.76% | 1.06% | 0.13% | 0.46% | — | 0.65% |
| CHF | 0.67% | 0.35% | 0.11% | 0.44% | -0.49% | -0.19% | -0.65% | — |
The heat map is read using the base currency from the left-hand column and the quote currency from the top row. For instance, selecting the British Pound as the base and moving horizontally to the US Dollar cell gives the percentage change for GBP (base)/USD (quote) over the week.
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