The EURGBP pair, currently trading at 0.85457, continues to rebound from its lowest point in the past five weeks in response to negative retail sales data from the UK.

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• EUR/GBP extends recovery from the lowest level in five weeks after downside UK Retail Sales data.

The pair currently trades last at 0.85457.

The previous day high was 0.8557 while the previous day low was 0.8524. The daily 38.2% Fib levels comes at 0.8536, expected to provide support. Similarly, the daily 61.8% fib level is at 0.8544, expected to provide support.

EUR/GBP picks up bids to extend the intraday high near 0.8545 as it cheers the downbeat UK data amid early Friday morning in London. In doing so, the cross-currency pair also benefits from the recently easing fears about the economic slowdown in Eurozone and Germany. Above all, sluggish markets and cautious mood ahead of the next week’s key events allow the quote to print the first daily gains in six while bouncing off the lowest level in five weeks.

That said, UK Retail Sales -1.4% YoY in July versus -2.1% expected and -1.0% prior whereas the Retail Sales ex-Fuel, also known as the Core Retail Sales slumped to -3.4% on the yearly basis compared to -2.2% market forecasts and -0.9% marked in June.

On the other hand, the Eurozone trade surplus improved seasonally adjusted (s.a) and non-seasonally adjusted (n.s.a) for June. That said, the former grew to €12.5B while the latter rose to €23B versus €0.2B and €-0.3B respective priors. Earlier in the week, Eurozone Industrial Production marked a surprise growth for June but the second readings of the Eurozone Gross Domestic Product (GDP) for the second quarter (Q2) confirmed initial forecasts whereas the Employment Change eased for the said period.

It’s worth noting that the market’s cautious mood ahead of the next week’s annual event at the Jackson Hole Symposium, where the top-tier central bankers speak, allows the EUR/GBP to pare weekly losses.

Looking ahead, the final readings of Eurozone inflation for July and a speech from the European Central Bank (ECB) Chief Economist Philip Lane will be crucial to follow.

A clear upside break of 0.8545 resistance confluence, comprising a one-week-old descending trend line and late July’s swing low, becomes necessary for the EUR/GBP buyers to keep the reins. Otherwise, the multi-month low marked the last week around 0.8500 stays on the trader’s radar.

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.8538 at the time of writing. Pair opened at 0.853 and is trading with a change of 0.09% % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 0.8598, 50 SMA 0.8585, 100 SMA @ 0.866 and 200 SMA @ 0.872.

The previous day high was 0.8557 while the previous day low was 0.8524. The daily 38.2% Fib levels comes at 0.8536, expected to provide support. Similarly, the daily 61.8% fib level is at 0.8544, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.8517, 0.8503, 0.8483
• Pivot resistance is noted at 0.855, 0.8571, 0.8584

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