EURGBP
EURGBP is under selling pressure in today’s Asian session ahead of a roster of economic data from the UK and the euro zone. As of this writing, the currency pair is trading at 0.8959, down from its opening price at 0.8978.
At 7:00 am GMT today, the UK claimant count change report for May will be released. It is eyed to show that 405,300 people filed for unemployment benefits for the month. Along with this, the unemployment rate is anticipated to clock in at 4.7% while the average hourly earnings is seen at 1.4%.
Then at 10:00 am GMT, the euro zone-wide ZEW economic sentiment report for June is estimated at 53.4. Meanwhile, the German version of the report is anticipated at 60.0. Readings above the 0.0 baseline are interpreted as signs of optimism. And so, it will be interesting to see if confidence did improve in June from May when the readings were at 46.0 and 51.0, respectively.
Better-than-expected UK data or disappointing euro zone numbers could push EURGBP lower. On the other hand, worse-than-expected UK figures or positive euro zone readings could be bullish for the currency pair.
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On the 1-hour time frame, it can be seen that EURGBP has made lower highs after making a series of higher highs. Consequently, a head and shoulders chart pattern has formed. When you enroll in our free forex trading course, you will learn that this is widely considered as a bearish reversal indicator.
A strong, decisive close below the neckline support at 0.8955 could mean that we could see more downside movement on EURGBP. Near-term support for the currency pair is at 0.8895 where it bottomed on June 10.
Alternatively, if the currency pair is unable to close below the neckline support, we could soon see it trade higher. Near-term resistance for EURGBP is at 0.8995 where it topped on June 15.