- EUR/GBP looks for direction in the mid-0.8400s on Tuesday.
- UK flash Q4 GDP came in flat QoQ and at 1.1% YoY.
- ECB’s C.Lagarde, BoE Carney due to speak later in the session.
Rangebound performance in both the sterling and the single currency is motivating EUR/GBP to remain side-lined around the 0.8450 area in the first half of the week.
EUR/GBP unchanged post-data
The cross is prolonging the consolidative theme prevailing since the start of the month, with gains showing some resistance in the 0.8550 zone and contention emerging in the 0.8400 neighbourhood for the time being.
In the docket, the British pound quickly faded the bullish attempt after the advanced GDP figures showed the economy is seen expanding 1.1% during the October-December period and the monthly GDP expanded 0.3% (vs. 0.2% forecasted). additional decent results showed the trade surplus coming in at £0.85 billion during the last month of 2019.
On the poor side of the UK docket, Industrial and Manufacturing Production expanded at a monthly 0.1% and 0.3% during December, both prints missing previous estimates.
Later in the session, ECB’s C.Lagarde will speak before the European Parliament, while BoE’s M.Carney will speak before the Lords Committee and Fed’s J.Powell is also testifying in the US Congress, all events expected to bring in some volatility to the markets.
EUR/GBP key levels
The cross is up 0.02% at 0.8449 and faces the next hurdle at 0.8537 (weekly/monthly high Feb.4) seconded by 0.8581 (100-day SMA) and finally 0.8595 (2020 high Jan.14). On the flip side, a breach of 0.8385 (2020 low Jan.24) would expose 0.8275 (2019 low Dec.13) and then 0.8248 (monthly low July 2016).