- EUR/GBP justifies pullback from key SMA to refresh weekly bottom.
- One-month-old broad support area could challenge the sellers.
- German IFO numbers, UK Retail Sales will be the key to watch.
EUR/GBP takes offers around 0.8556, down 0.08% intraday, ahead of Friday’s European session. In doing so, the quote refreshes the weekly low while extending the previous day’s pullback from 200-SMA.
Given the RSI’s slight distance from oversold conditions, the quote can extend the fall towards revisiting the broad support zone established since late February, around 0.8550-30.
However, any further weakness past-0.8530 might not refrain from breaking the 0.8500 threshold while highlighting January 2020 lows near 0.8385.
Meanwhile, corrective pullback needs to cross 0.8600 before confronting the 200-SMA level of 0.8635.
Also acting as an upside barrier is the weekly top surrounding 0.8645 and the monthly peak close to 0.8670.
Talking about calendar events, both the UK and German data bear upbeat consensus but covid pessimism in the bloc may not allow the euro to cheer strong results if any.
EUR/GBP four-hour chart
Trend: Bearish
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