#EURGBP @ 0.88234 drifts lower for the second successive day, though lacks follow-through selling. (Pivot Orderbook analysis)

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• EUR/GBP drifts lower for the second successive day, though lacks follow-through selling.
• The softer German GDP report weighs on the Euro and exerts some pressure on the cross.
• Investors now look to the German consumer inflation figures for some meaningful impetus.

The pair currently trades last at 0.88234.

The previous day high was 0.8872 while the previous day low was 0.8823. The daily 38.2% Fib levels comes at 0.8841, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8853, expected to provide resistance.

The EUR/GBP cross attracts some sellers following an early uptick to the 0.8835-0.8840 region on Friday and turns lower for the second successive day. Spot prices drop to a fresh weekly low during the early part of the European session, with bears flirting with the 100-day Simple Moving Average (SMA) support around the 0.8800 mark.

The shared currency’s relative underperformance could be attributed to the disappointing release of the preliminary German GDP report, which turns out to be a key factor weighing on the EUR/GBP cross. In fact, Germany’s Destatis reported this Friday that growth in the Eurozone’s largest economy stagnated during the first three months of 2023. Moreover, the annualized GDP showed an unexpected contraction of 0.1%, down sharply from the 0.9% rise recorded in the final quarter of 2022. This, along with a goodish pickup in the US Dollar (USD) demand, exerts additional downward pressure on the Euro.

The British Pound, on the other hand, draws support from growing acceptance that the Bank of England (BoE) will hike interest rates by 25 bps in May. This further contributes to the offered tone surrounding the EUR/GBP cross, though the prospects for more rate hikes by the European Central Bank (ECB) should help limit further losses, at least for the time being. It is worth recalling that the ECB chief economist Philip Lane said on Tuesday that the central bank will need to raise interest rates again in May and leaving interest rates at current levels will be inappropriate despite falling inflation.

This, in turn, makes it prudent to wait for some follow-through selling and sustained weakness below the 100-day SMA before positioning for any further depreciating move. Traders might also prefer to move to the sidelines and wait for the release of the flash German consumer inflation figures. Nevertheless, the EUR/GBP cross remains on track to register modest losses for the second successive week as market participants start repositioning for the highly-anticipated ECB monetary policy meeting next Thursday.

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.8818 at the time of writing. Pair opened at 0.8824 and is trading with a change of -0.07 % .

The pair is trading above its 20 Daily moving average @ 0.8808, below its 50 Daily moving average @ 0.8818 , above its 100 Daily moving average @ 0.8811 and above its 200 Daily moving average @ 0.8721

The previous day high was 0.8872 while the previous day low was 0.8823. The daily 38.2% Fib levels comes at 0.8841, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8853, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.8807, 0.879, 0.8758
• Pivot resistance is noted at 0.8857, 0.8889, 0.8906

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