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EUR/GBP flirts with key fib levels

FXStreet (Mumbai) - The EUR/GBP pair trimmed gains in early Europe to trade around the 23.6% of the recovery from the July low located at 0.7360 levels.

EUR supported by German yields

The yield on the safe haven German bunds came under pressure last week on rising speculation that ECB would hint at extension/expansion of its QE program and/or possible cut in the deposit rate. Consequently, the investors were scared out of the common currency.

However, the safe haven 10-yr German yield ticked more than one basis points higher today, which is supporting the EUR. Nevertheless, the bid tone on the EUR appears weak on expectations of more easing from the ECB.

EUR/GBP Technical Levels

At 0.7360, a major resistance is seen at 0.7390 (hourly 200-MA), above which the pair could rise to 0.7415 (50% of last week’s fall). On the other side, a failure to sustain above 0.7360 could open doors for a sell-off to 0.7338 (last week’s low). A break below the same would expose 0.7278 (38.2% of recovery from July low).

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