EUR/GBP has been quite volatile and corrective with the recent gains after bouncing off the 0.8750 support area. EUR has found support from recent economic reports which helped the currency to gain good momentum over GBP. EUR is likely to keep momentum in the coming days. Today, German Gfk Consumer Climate report was published with a slight increase to 10.8 which was expected to be unchanged at 10.7, German Import Price report showed an increase to 0.8% from the previous value of 0.6%, and French Consumer Spending report showed a significant increase to 2.2% from the previous negative value of -2.1% which was expected to be at 1.4%. On the other hand, today UK Current Account report is going to be published which is expected to show less deficit at -21.5B from the previous figure of 23.2B, Final GDP is expected to be unchanged at 0.4%, Index of Services is expected to decrease to 0.3% from the previous value of 0.4%, and Revised Business Investment is expected to be unchanged at 0.2%. As for the current scenario, EUR is currently stronger in the pair whereas any positive economic report from the UK today may lead to further volatility and corrections in the pair though the bulls are currently quite strong and have better ability to sustain the gains over GBP in the coming days.
Now let us look at the technical chart. The price is currently residing above the dynamic level of 20 EMA which is working as a support for the price to push higher. The price has been quite volatile recently but now the price is holding above the recent lower highs which indicates that the bulls are getting ready to take the price much higher towards 0.9050 resistance area. As the price remains above 0.8750 support area, the bullish bias is expected to continue further.
The material has been provided by InstaForex Company – www.instaforex.com