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EURGBP breakout - where to next?

Luke Suddards

Research Strategist

Aug 31, 2022

Holidays to Europe are going to be a lot more expensive for Brits. Read below to find out more.

EURGBP is on the move as the energy crisis cools in Europe and hawkish bets on ECB rate hikes becomes consensus. Price has broken through a key 0.86 resistance level and the RSI has slightly overcome the 63.68 level, which has marked previous price rallies. It remains to be seen if price can reach the 15 June high of 0.872. 0.865 will need to be overcome first. Price has moved up quite rapidly and profit taking could take place soon, especially if the Nord Stream 1 maintenance is extended. Can't particularly see any bullish catalysts for the quid, especially with Goldman Sachs latest forecast of headline inflation to hit 22.4% in January if energy prices continue on their current path. Levels on the downside for pullbacks/targets would be 0.855 and the 50-day SMA at circa 0.85.

(Source: Tradingview EURGBP chart - Past performance is not indicative of future performance.)

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