EUR GBP

EUR/USD stalled by the pair has held up better than both EUR/JPY and EUR/GBP. This article looks at the single currency in three pairs for the week ahead.

The Bank of England cut rates last week but it was the two votes for a 50 bp cut that weighed on the currency on Thursday and Friday.

EUR/USD has been in a bearish state since the Q4 open, and it was six consecutive red weeks until last week.

It was a brutal week for the British Pound, with GBP showing its largest weekly loss against the Euro in more than a year.

EUR/USD continued an aggressive sell-off but EUR/JPY put in a clean breakout from an ascending triangle. Meanwhile, EUR/GBP has set the initial steps for a possible bounce.

Despite international factors, domestic concerns remain for the German economy, discouraging us to be very bullish on the EUR/USD forecast, despite the dollar’s overall bearish trend. Indeed, looking at euro crosses such as the EUR/GBP, which is approaching its post-Brexit lows, you can see that there is very little underlying strength for the euro and that the EUR/USD’s weakness is masked by a weak US dollar right now.

We have seen further widening of the bond yield spreads between German and French debt today. Investors are clearly worried about a sustained period of political uncertainty and are therefore seeking haven assets and reducing their risk exposure.

Euro pairs gapped lower at Monday's Asian open on news of Macron's snap election following painful election results for the left. EUR/USD broke beneath its 200-day EMA and EUR/GBP fell to a 22-month low.

It was another strong week for the British Pound as Core CPI came out well-above the expectation, leading to a 1.2750 test in GBP/USD and a 200.00 test in GBP/JPY.

The Bank of England hosts a rate decision on Thursday and GBP/USD has pushed back-above the 1.2500 handle. GBP/JPY slid after touching the 200.00 mark for the first time since 2008, and EUR/GBP is showing bearish breakdown potential with two different technical formations.

A quick look at the charts suggests the British pound might be nearing a burst of energy, and that could be beneficial for GBP/USD bulls or EUR/GBP bears.