Key Points
- The Euro after setting a short-term top around the 0.8725 level versus the British Pound started to move down.
- There was a bullish trend line formed on the hourly chart of the EURGBP pair, which was broken during the downside drift.
- In the UK today, the Retail Sales report was released by the National Statistics.
- The outcome was positive, as there was a rise of 1.4% in July 2016, more than the forecast of 0.2%.
EURGBP Technical Analysis
The Euro enjoyed heavy gains against the British Pound recently, and traded above the 0.8700 level before finding sellers. The EURGBP pair started moving down, and already broke a bullish trend line formed on the hourly chart.
The pair is also below the 21 hourly simple moving average, and the 50% Fib retracement level of the last wave from the 0.8517 low to 0.8726 high.
So, there is a high probability of EURGBP moving down further from the current or a bit higher levels.
UK Retail Sales
Today, the UK Retail Sales, which measures the total receipts of retail stores and the percent changes reflect the rate of changes of such sales was released by the National Statistics.
The market was expecting a rise of 0.2% in sales in July 2016, compared with the previous month. However, the result was above the forecast, as there was an increase of 1.4%. The report added that the “underlying pattern in the quantity bought, as suggested by the 3 month on 3 month movement, increased by 1.6%. Compared with May 2016, the quantity bought in the retail industry is estimated to have decreased by 0.9%. Average store prices (including petrol stations) fell by 2.5% in June 2016 compared with June 2015”.
The figures were impressive, which result in a down move in EURGBP. The pair looks poised for more losses in the near term.
