EUR/GBP looks to German ZEW sentiment data, EZ GDP
EUR/GBP is pushing higher, extending gains from the previous session. A surprise jump in German factory orders sent the pair higher. German factory orders rose 3.4% July, after rising 4.6% in June. Forecasts had been for a 1.1% rise.
Today the data continues to flow thick and fast. German industrial production came in better than forecast at 1%, after contracting 1% in June. Expectations had been for
Looking ahead, Eurozone GDP Q2, the third revision is expected to confirm 2% growth QoQ. German ZEW economic sentiment data is expected to reveal a deterioration in economic sentiment.
The EUR is also finding some support from hawkish expectations surrounding Thursday’s ECB meeting.
Where next for EUR/GBP ?
EUR/GBP has been on the rise since hitting a low of 0.8450 on August 10. The pair reached a high of 0.86 before easing lower. Currently the pair is struggling to push beyond 0.5880 the 100 sma.
EUR/GBP continues to find support from the month old ascending trendline. A sustained move above the 100 sma could lift the pair buyers to test the August high of 0.86 and on to 0.8620 the July 7 high.
An upturn in the receding bullish bias on the MACD would be needed to propel the pair towards 0.8670 the July high.
On the downside, immediate support can be seen at 0.8550 the 50 sma ahead of 0.85 the July low.
FTSE eases lower, strong Chinese data, housing data could limit losses
European markets are set to open lower handing back some of yesterday’s gains. However, losses could be small given that Chinese trade data pointed to strong global demand.
Chinese exports rose faster than forecast in August at 25.6% YoY following from 19.3% gain in July.
Upbeat German industrial production is helping the mood. More European data is due this morning.
UK housing market data revealed house prices grew 0.7% MoM in August, up from 0.4% in July. Annually house price growth cooled slightly to 7.1%, down from August 7.6%.
Where next from FTSE?
Once again the FTSE’s advance has run out of steam. After pushing above briefly above resistance at 7185, the index today is back below that level.
The index trades in a tight range above its multi-week ascending trendline. Strong support can be seen around 7140 the rising trendline support, 50 & 200 sma on the 4 hour chart. A move below this level could negate the near term uptrend.
It would take a move below 7090 for the sellers to gain traction.