EURUSD
EURGBP was 0.25% lower on Friday as the market awaits Eurozone inflation and a statement from Boris Johnson. U.K. Prime Mininster Johnson will make a speech later today outlining the country’s next steps on Brexit.
Analysts are expecting to see talks between the EU and U.K. over Brexit delayed by another two week period. Negotiations hit another stalemate this week with both sides criticizing the other and the EU’s President Ursula von der Leyen was in self-isolation after a staff member took ill. Boris Johnson had threatened to walk away from talks by mid-October if a deal hadn’t been reached but it is now looking like a bluff.
Eurozone inflation came in as expected on Friday with the core indicator showing a 0.2% print. The number will take some pressure off of ECB members who have been concerned about the deflationary effects of a stronger euro. Traders have been looking for signs of sagging inflation that could see a currency intervention occur. This week has seen both German and Eurozone numbers come in as expected so the threat is off for now.
In the U.K., Boris Johnson seems set to push a nationwide lockdown over fears of a virus second wave. Another round of restrictions wouldn’t be good for the country’s economy which already saw dismal jobs figures in the last week.
EURGBP closed below the 50-day moving average on Wednesday and threatened a potential move lower. The price action yesterday has the potential to confirm a base for a move higher to the 0.9175 level. The pair is mixed at the moment and a large position is not advised. If you require assistance with risk/reward and trade entry, then please consider the Investing Cube Forex Trading Course or one-to-one coaching.
