EUR/GBP is stuck now, within a short term trading range, buyers remain ready at 0.7880 which is an important support level.Sellers seems to have control over 0.7920 levels.
A break above seller territory will indicate fresh buying power with next resistance at level 0.7950, also since we are in a trading range a break below buyer’s territory of 0.7880 will open the door for more downside potential at 0.7860 and 0.7840 levels.
Worry over a potential U.K. exit from the EU zone continued to frighten most investors. The pound went down sharply against most other major currencies earlier in the week when Brussels was hit by bomb explosions at the airport and a central subway station, leaving more than 32 dead and around 280 wounded.
German PMI reports pointed towards a mixed picture with moderate expansion in the services sector, but almost zero growth in the manufacturing industry, which has been hit by the Chinese slowdown. German IFO improved to 106.7 points, beating the expectations by a wide margin. ZEW Economic Sentiment improved to 4.3 points, but it fell short of the estimate of 6.3 points. German Consumer Climate edged lower to 9.4 points, within expectations. Also on Thursday, the ECB announced its LTRO (Long Term Refinancing Option) on Thursday. This lending program aims to bolster the economy by increasing bank lending to the real economy.
The current situation in EUR/GBP is characterized right now by uncertainty, waiting for markets to decide which way it will take.