- Euro struggled recently against the British Pound, and it looks like set for more downsides.
- There is a bearish trend line formed on the hourly chart of the EURGBP pair, which is acting as a resistance and pushing the pair down.
- Euro Area Industrial Production is released by the Eurostat posted an increase of 2.1% in Jan 2016, more than the forecast of 1.5%.
- In terms of the yearly change, there was a rise of 2.8% in Jan 2016, which was again more than the forecast of 0.9%.
The Euro after setting a short-term top around the 0.7845 level traded down against the British pound. There is a bearish trend line formed on the hourly chart of the EURGBP pair, which acted as a catalyst for the downside move.
The pair is currently below the 100, 200 and 50 hourly simple moving average, which is a bearish sign. So, there is a chance of more losses.
On the downside, the pair may head towards the 0.7700 support area in the near term.
Euro Area Industrial Production
Today, the Industrial Production that shows the volume of production of Industries such as factories and manufacturing was released by the Eurostat. The market was expecting an increase of 1.5% in Jan 2016, compared with the previous month. . However, the result was above the forecast, as the increase was 2.1%.
The report stated that in “January 2016 compared with December 2015, seasonally adjusted industrial production rose by 2.1% in the euro area (EA19) and by 1.7% in the EU28, according to estimates from Eurostat, the statistical office of the European Union. In December 2015 industrial production fell by 0.5% in the euro area and by 0.6 in the EU28”.
Overall, the Euro may trade down against the British pound as long as it is below the 100 hourly SMA.