#EURGBP @ 0.86385 breaks key short-term support. (Pivot Orderbook analysis)

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• EUR/GBP breaks key short-term support.
• Pound recovers ground from multi-month lows.
• UK August CPI annual rate drops below 10% in August.

The pair currently trades last at 0.86385.

The previous day high was 0.8694 while the previous day low was 0.8648. The daily 38.2% Fib levels comes at 0.8676, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8665, expected to provide resistance.

The EUR/GBP is falling on Wednesday, extending the correction from the highest level in more than a year it reached on Monday at 0.8721. The cross recently bottomed at 0.8624.

The pound gained momentum after breaking the 0.8650 support area. The very short-term outlook points to the downside, while under 0.8650. Below the daily low, the next support stands at 0.8605.

Data released in the UK on Wednesday showed inflation eased in August with the annual CPI rate falling from 10.1% to 9.9%, against expectations of a 10.2% reading. It still remains near 40-year highs. Despite the figures, the Bank of England is still expected to raise key interest rates by 50 basis points next week.

On the economic front, Industrial Production showed a decline of 2.3% in the Eurozone against expectations of a more modest decline. The European Central Bank is seen hiking rates again by 75 basis points.

Regarding the energy crisis, the European Union said today it expects to raise €140 billion from windfall taxes on energy companies. The European Commission wants a target to cut electric use by 10%.

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.8631 at the time of writing. Pair opened at 0.8673 and is trading with a change of -0.48 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 0.8563, 50 SMA 0.8494, 100 SMA @ 0.8514 and 200 SMA @ 0.8448.

The previous day high was 0.8694 while the previous day low was 0.8648. The daily 38.2% Fib levels comes at 0.8676, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8665, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.8649, 0.8625, 0.8603
• Pivot resistance is noted at 0.8696, 0.8718, 0.8742

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