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Forex: EUR/GBP down at 0.8456 on European opening

FXstreet.com (Barcelona) - After an early drop to 0.8465 in the Asian shift that was retraced back to the opening area of 0.8470/75, the EUR/GBP tumbled ahead of Markit manufacturing PMI data in the Euro area and extended losses to 0.8456 low. The market remains pressured and able to suffer further losses.

The EMU PMI dropped slightly from 46.8 to 46.7, but analysts were expecting 46.5. The German figure eased from 49.0 to 48.3, instead of 47.9. The Italian number rose from 44.5 to 45.5, above 44.8 expected. The Spanish PMI came in higher, from 44.2 to 44.7 in April, beating 44.5 consensus. The Greek manufacturing figure rose from 42.1 to 45. The UK PMI Construction is due at 08:30 GMT.

“The market sold off last week below its cloud support and this is the first time that the market has traded below its cloud since August 2012”, wrote Commerzbank analyst Karen Jones, explaining that the cloud offers resistance at 0.8540, and while capped there intraday they’ll assume that the market will remain directly offered. “We look for further losses to 0.8363 and .then the 0.8290 2012-2013 uptrend”, she added.

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