Forex: EUR/GBP storms to 0.8450 on surprising German factory orders

FXstreet.com (Barcelona) - With the 0.8415 area holding the cross against the downside, the EUR/GBP stormed off to the upside as March German factory orders contradicted the latest gloomy surveys. Investors are cheering with the surprising 2.2%, instead of the -0.5% contraction as expected. February data was revised slightly lower from 2.3% to 2.2%. German factory orders in year-on-year basis dropped further, from -0.2% (revised from 0.0%) to -0.4%, but that came in better than the -2.9% expected.

As of writing, the EUR/GBP upward movement is being blocked by 0.8440/50, around where it found resistance since Friday.

Earlier, the French industrial output not only contracted as predicted, but fell by -0.9% instead of the market consensus of -0.3%. The French trade deficit narrowed from €-6.011B to €-4.696B, beating €-5.600B consensus, as exports grew from €35.703B to €36.204B while imports dropped from €41.348B to €40.9B.

“The EUR/GBP is sitting back on the three month support line at 0.8392, a fall through which will have the 2012-13 support line at 0.8301 in focus. The currency pair will remain immediately offered while trading below the late April high at 0.8497”, wrote Commerzbank analyst Axel Rudolph.