EUR/USD, GBP/USD try to stabilize while EUR/GBP range trades
Outlook on EUR/USD, GBP/USD and EUR/GBP amid weaker-than-expected Eurozone growth and rising UK wages and unemployment.
EUR/USD stays close to 3-month low
EUR/USD remains under pressure as Eurozone growth forecasts were revised lower. The Euro Area economy is expected to grow by 0.8% in 2023, lower than the previously projected 1.1% expansion, as persistently high inflation exerts pressure on consumption, the European Commission’s Summer 2023 Economic Forecast showed.
EUR/USD is thus coming off its $1.0769 intraday high and is seen slipping back towards the $1.07 region. Further down lurks three-month low at $1.0687. A fall through Thursday’s $1.0687 low would target the May low at $1.0636.
Minor resistance sits around the $1.0766 August low and Tuesday’s intraday high and, further up, along the 200-day simple moving average (SMA) at $1.0826 as well as at the July low at $1.0834.
EUR/GBP trades in the middle of its sideways trading range
EUR/GBP continues to trade towards the middle of its June-to-September sideways trading range around the 55-day SMA at £0.8584 as Eurozone growth is slowing while inflation remains sticky.
A rise above last week’s high at £0.8601 would engage the late August high at £0.861 but a fall through Monday’s low at £0.8559 the current September low at £0.8524. It was made close to key support seen between the £0.8522 to £0.8504 June and July lows.
GBP/USD tries to find support above the 200-day SMA
GBP/USD tries to hold above last week’s $1.2446 3-month low as the UK unemployment rate edged up to 4.3% for July, while wages including bonuses rose 8.5% for the three months to July, ahead of forecasts.
A slip through last Thursday’s low at $1.2446 low would eye the 200-day SMA at $1.2431 but may offer support. If not, the June low at $1.2369 could be reached as well.
Resistance can be spotted at the $1.2549 late August low and Monday’s high and then also at the $1.2591 June low. While next higher resistance at $1.2819 isn’t overcome, the medium-term trend remains bearish.
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