FxWirePro: EUR/GBP snaps 4-day downtrend, upbeat eurozone inflation data supports

Chart - Courtesy Trading View 

EUR/GBP was trading 0.37% higher on the day at 0.8608 at around 13:10 GMT.

The pair has snapped a 4-day downtrend and has edged higher after euro garnered support from upbeat inflation data.

The latest data published by Eurostat showed that the annualized Eurozone Harmonised Index of Consumer Prices (HICP) accelerate to 10.7% in October from 9.9% in the previous month. 

The core figures climbed to 5.0% YoY during the reported month as compared to the 4.9% expected and 4.8% recorded in September.

Also, Eurozone economy expanded by 0.2% on the quarter in the three months to September of 2022, meeting the 0.2% expected and 0.8% previous.

On an annualized basis, the bloc’s GDP rate printed at 2.1% in Q3 vs. 4.1% booked in the second quarter of 2021 while matching 2.1% expectations.

That said, expectations for a 75 bps hike by the Bank of England warrant some caution for further appreciation in the pair.

Technical indicators also support weakness in the pair. Momentum is bearish, volatility is high and rising. 

The pair is on track to test 200-DMA support. Bearish invalidation only above 21-EMA.