EUR/GBP made a 100 pips move upwards today, with soaring British Unemployment and Trichet’s optimism pushing the Pound down and the Euro up.
EUR/GBP now trades at 0.9390, after breaking last week’s high of 0.9318 which it reached last week. During the day, it passed the 0.94 mark, hitting a high of 0.9414.
The Euro moved up today against the dollar, with the EUR/USD climbing above 1.31. Jean-Claude Trichet said that he believes that growth will resume in the beginning of 2010.
On the other hand, the British Pound fell against the dollar on the very disappointing employment figures in the UK. Claimant Count Change, which whows the change in the number of people claiming unemployment benefits during the last month, rose to 138.4K, much much more than early expectations, of 84.5K. Also the previous month’s figure was revised: it now stands at 93.5.
The British Pound collapsed fast, and fell against the dollar to 1.3859. GBP/USD then retracted, and is now trading at 1.3984.
So, this double move in Europe and in Britain, sent the EUR/GBP pair up. After EUR/GBP broke the downtrend resistance line one week ago, it continues upwards.
The targets for EUR/GBP haven’t changed: the next resistance is at 95 – which was the high point in January 26th. This point forms the downtrend resistance that was broken. The next point is of course the highest – 0.98, when EUR/GBP was almost at parity.
So, this is another step in the road to EUR/GBP parity. I’ll follow this interesting cross.