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EUR/GBP tests lows near 0.7950

FXStreet (Edinburgh) - The weakness around the single currency is now intensifying, dragging the EUR/GBP back to the mid-0.7900s, or weekly lows.

EUR/GBP hurt by ZEW

The cross is coming down after the ZEW Survey for both Germany and the euro area disappointed investors for the moth of August, posting important pullbacks. Next of relevance will be the German final inflation figures for July followed by UK’s labour market data, all due tomorrow. “We still think the longer-term direction of the cross is lower so gains should be viewed as corrective and should remain limited in scale. The high 0.79 area has capped EUR gains through July and converges with retracement resistance. A clear move through 0.80 may see 0.8075 tested before the downtrend resumes”, observes Shaun Osborne, Chief FX Strategist at TD Securities.

EUR/GBP levels to consider

The cross is now losing 0.24% at 0.7953 and a breakdown of 0.7937 (low Aug.8) would open the door to 0.7935 (30-d MA) and finally 0.7925 (low Aug.7). On the upside, the initial barrier aligns at 0.7980 (high Aug.12) followed by 0.7997 (high Aug.8) and then 0.8007 (high Jul.1).

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