The EURGBP currency pair is maintaining a lower position near its lowest point of the day, which has led to its first daily decline in four days.

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• EUR/GBP holds lower grounds near intraday low, printing the first daily loss in four.

The pair currently trades last at 0.86043.

The previous day high was 0.8656 while the previous day low was 0.8596. The daily 38.2% Fib levels comes at 0.8633, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8619, expected to provide resistance.

EUR/GBP drops 0.12% intraday as it reports the first daily loss, so far, in four days around 0.8600 heading into Friday’s European session. In doing so, the cross-currency pair extends late Thursday’s U-turn from a two-week high as market players await the key catalysts from Eurozone and the UK.

Thursday’s softer prints of the Eurozone Producer Price Index (PPI) for June, the lowest in three years, with -3.4% YoY figures versus -3.1% expected and -1.6% prior (revised), weighed on the EUR/GBP price initially ahead of the Bank of England (BoE) Interest Rate Decision.

Also contributing to the quote’s weakness could be the final readings of the bloc’s HCOB Composite PMI and Services PMI for July deteriorated while the same activity numbers for Germany improved from the initial forecasts for the said month.

It’s worth noting that the mixed comments from European Central Bank (ECB) board member Fabio Panetta also weighed on the pair as he supported high interest rates for a longer time via a webinar. The policymaker, however, also added, “Inflation risks are balanced and economic activity is weak.”

On the other hand, the Bank of England (BoE) matched market forecasts by lifting the benchmark interest rates to the highest level in 15 years with a 0.25% increase to 5.25%. However, the policymakers appear divided with most favoring the latest move and a few backing a 0.50% rate hike while one BoE voting member backed no rate hike.

Following the BoE Interest Rate Decision, Governor Andrew Bailey spoke at the press conference and ruled out the case for a 50 basis point rate rise in the latest meeting. Further, BoE Governor Bailey also conveyed expectations of witnessing softer inflation, as well as the hopes to deliver the path they expect with no recession while adding, “We will have to see.” It’s worth noting that BoE Governor also mentioned, “Projection for economic activity has weakened since May.”

Looking forward, Germany’s Factory Orders and Eurozone Retail Sales for June will be closely observed for immediate directions. Following that, the final readings of the UK’s S&P Global Construction PMI for August and a speech from BoE Chief Economist Huw Pill should entertain the EUR/GBP traders.

Repeated failures to provide a daily closing beyond the 100-day Exponential Moving Average (EMA), around 0.8655 at the latest, keep EUR/GBP bears hopeful. The pullback moves, however, need validation from the 21-day EMA level of around 0.8590.

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.8606 at the time of writing. Pair opened at 0.8616 and is trading with a change of -0.12% % .

The pair is trading above its 20 Daily moving average @ 0.8589, above its 50 Daily moving average @ 0.8589 , below its 100 Daily moving average @ 0.868 and below its 200 Daily moving average @ 0.8725

The previous day high was 0.8656 while the previous day low was 0.8596. The daily 38.2% Fib levels comes at 0.8633, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8619, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.8589, 0.8563, 0.853
• Pivot resistance is noted at 0.8649, 0.8682, 0.8708

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