Cross-currency is nearly flat throughout the day because both currencies are the main gainers of the FX complex.
EUR/GBP is stuck between the 50- and 100-DMAs, a 36-pip range.
EUR/GPB has a neutral bias, but could shift in the opposite direction if there is a rise of the 100-DMA.
During the North American session, the EUR/GBP was barely lower. The EUR/GBP trades at 0.8413 as of the writing.
Global financial markets are facing a risk-off mood. According to the US Department of Labor, January inflation rose 7.5% higher than expected. This led to a sell-off of US equity markets. The history of the FX complex is very different. The EUR and GBP are the winners, while the CAD (and the JPY) are the losers.
However, Thursday’s EUR/GBP price action was limited to a trading range of 36 pip, as investors focused on US macroeconomic data.
EUR/GBP Forecast: Technical Outlook
The EUR/GBP has risen from below 0.8350 to 0.8478 in the past week following the Bank of England’s rate hike and the European Central Bank’s pivot towards a “hawkish” monetary policy stance.
The EUR/GBP is neutrally biased at press time. It sits between the 0.8413 50-day moving mean (DMA), and 0.8449 100-day moving averages (DMA). A break above the 100-DMA at 0.8413 would change the trend to neutral-upwards. However, the 200-DMA, which is located above the exchange rate at 0.8501, could be an upside event. The 200-DMA would then be at 0.8501 as the first resistance. Breach of this would expose December 20, 2021 at 0.8550. This is followed by a nine month-old trendline downslope around the 0.8590-0.8600 area.
