- EUR/GBP strengthens 0.8435 in Friday’s Asian session.
- The cross keeps the bearish vibe below the 100-period EMA, but RSI indicator shows further upside cannot be ruled out.
- The immediate resistance level emerges at 0.8440; 0.8417 acts as an initial support level.
The EUR/GBP cross trades in positive territory for the third consecutive day around 0.8435 during the Asian session on Friday. The Eurozone Gross Domestic Product (GDP) for the second quarter (Q2) will be closely watched, which is estimated to grow 0.3% QoQ and 0.6% YoY in the second quarter (Q2).
According to the 4-hour chart, the negative outlook of EUR/GBP remains intact as the cross holds below the key 100-period Exponential Moving Averages (EMA). However, the further upside cannot be ruled out as the Relative Strength Index (RSI) points higher above the midline near 56.0.
The first upside barrier for EUR/GBP emerges at 0.8440, the upper boundary of the Bollinger Band. Further north, the next hurdle is seen at 0.8457. A decisive break above this level will see a rally to the 0.8500 psychological level.
On the flip side, the initial support level is located at 0.8417, the lower limit of the Bollinger Band. The potential contention level to watch is the 0.8400-0.8405 region, representing the round figure and the low of September 3. The additional downside filter to watch is 0.8383, the low of July 17.
EUR/GBP 4-hour chart
(This story was corrected on September 6 at 06:59 GMT to say, in the title, that the first barrier emerges at around 0.8450, not 0.8550.)
GDP FAQs
A country’s Gross Domestic Product (GDP) measures the rate of growth of its economy over a given period of time, usually a quarter. The most reliable figures are those that compare GDP to the previous quarter e.g Q2 of 2023 vs Q1 of 2023, or to the same period in the previous year, e.g Q2 of 2023 vs Q2 of 2022. Annualized quarterly GDP figures extrapolate the growth rate of the quarter as if it were constant for the rest of the year. These can be misleading, however, if temporary shocks impact growth in one quarter but are unlikely to last all year – such as happened in the first quarter of 2020 at the outbreak of the covid pandemic, when growth plummeted.
A higher GDP result is generally positive for a nation’s currency as it reflects a growing economy, which is more likely to produce goods and services that can be exported, as well as attracting higher foreign investment. By the same token, when GDP falls it is usually negative for the currency. When an economy grows people tend to spend more, which leads to inflation. The country’s central bank then has to put up interest rates to combat the inflation with the side effect of attracting more capital inflows from global investors, thus helping the local currency appreciate.
When an economy grows and GDP is rising, people tend to spend more which leads to inflation. The country’s central bank then has to put up interest rates to combat the inflation. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold versus placing the money in a cash deposit account. Therefore, a higher GDP growth rate is usually a bearish factor for Gold price.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD turns lower toward 1.1300 as US Dollar demand picks up
EUR/USD has come under renewed selling pressure and heads back toward 1.1300 n Monday’s European session. The upbeat market mood and a fresh US Dollar uptick undermines the pair amid a quiet start to a critical week ahead.
GBP/USD drops back below 1.3300 on US Dollar strength
GBP/USD returns to the red below 1.3300 in the European trading hours on Monday. Sustained US Dollar strength and easing trade tensions weigh negatively on the pair. Meanwhile, the technical outlook on the daily chart suggests a weakening bullish trend.
Gold price remains depressed below $3,300 amid signs of easing US-China trade tensions
Gold price maintains its offered tone through the Asian session on Monday and currently trades below the $3,300 round-figure mark, down 0.75% for the day. Despite mixed signals from the US and China, investors remain hopeful over the potential de-escalation of tensions between the world's two largest economies.
Bitcoin and Ethereum stabilize while Ripple shows strength
Bitcoin and Ethereum prices are stabilizing at around $93,500 and $1,770 at the time of writing on Monday, following a rally of over 10% and 12% the previous week. Ripple price also rallied 8.3% and closed above its key resistance level last week, indicating an uptrend ahead.
Week ahead: US GDP, inflation and jobs in focus amid tariff mess – BoJ meets
Barrage of US data to shed light on US economy as tariff war heats up. GDP, PCE inflation and nonfarm payrolls reports to headline the week. Bank of Japan to hold rates but may downgrade growth outlook. Eurozone and Australian CPI also on the agenda, Canadians go to the polls.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.