Key Points
- The Euro moved down heavily against the British Pound and looks set for more losses going forward.
- There is a bearish trend line formed on the hourly chart of the EURGBP pair, which is acting as a hurdle for the Euro buyers.
- The Euro Zone PMI service released by the Markit Economics posted a decline from 53.1 to 52.8 in August 2016.
- The German Services PMI also posted a decline from 53.3 to 51.7 in August 2016.
EURGBP Technical Analysis
The Euro faced a lot of selling pressure versus the British Pound and traded towards the 0.8351 level. There is a bearish trend line formed on the hourly chart of the EURGBP pair. It is acting as a resistance and pushing the pair down.
Moreover, the 21 hourly simple moving average is also positioned around the same trend line to act as a barrier.
On the downside, the pair may head towards the 0.8351 level at least or even break it for a test of 0.8320.
Euro Zone Services PMI
Today during the London session, the Services PMI, which interviews German executives on the status of sales, employment, and their outlook was released by the Markit Economics.
The forecast was lined up for a no change in August 2016 from the last reading of 53.1. However, the outcome was on disappointing, as there was a decline to 52.9. The report added that “August data pointed to a growth slowdown in Germany’s service sector, with new business and activity rising at the weakest rates in more than one and three years, respectively. Moreover, confidence towards the year ahead reached its lowest level since last October. Sharply rising employment levels helped alleviate pressure on operating capacity, with backlogs of work declining for the second month running”.
In short, the Euro may decline further and trade towards the 0.8340 level against the British Pound.
