EUR/USD, EUR/GBP and GBP/USD slip on stronger dollar and UK retail sales
Outlook on EUR/USD, EUR/GBP and GBP/USD as greenback regains lost ground and UK retail sales come in much stronger-than-expected.
EUR/USD drops as greenback regains lost ground
EUR/USD ran out of steam slightly below its mid-February 2022 low at $1.128 earlier this week when it managed to rally to $1.1275 before coming off again on profit taking ahead of the weekend and as the U.S. dollar regained some recently lost ground.
The April peak at $1.1095 may soon be reached but together with the mid-April high at $1.1075 should act as support on Friday, were it to be reached at all.
Immediate minor resistance can be found at Thursday’s $1.1175 low and further resistance around the $1.12 mark. Above this week’s high at $1.1275 lie the 61.8% Fibonacci retracement of the 2020-to-2022 bear market and the mid-February 2022 low at $1.128.
EUR/GBP comes off its six-week highs
EUR/GBP's rally to its six-week high at £0.8701 as UK inflation slowed more-than-expected is being followed by a short-term decline on the back of stronger-than-expected UK retail sales.
British retail sales in June were boosted by unusually hot weather and a rebound in food sales after a dip the month before when public holidays disrupted normal spending patterns. June retail sales came in at 0.7% versus May, a bigger increase than the 0.2% forecast by economists.
A slip back towards the 55-day simple moving average (SMA) at £0.8617 may thus ensue. Resistance remains to be seen at this week’s £0.8701 high. If a daily chart close above £0.8701 were to unfold, the 200-day SMA at £0.873 would be next in line.
GBP/USD reverses its trend from its 16-month high
Stronger-than-expected UK retail sales on the back of slowing UK inflation seen earlier this week has led to GBP/USD topping out at its $1.3142 16-month high.
The cross is now revisiting its $1.2848 June peak which may offer support. If not, the $1.269 minor support zone may be reached next.
Immediate resistance can be found at Thursday’s $1.2964 high and around the minor psychological $1.30 mark.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices