EURGBP – strong pressure from negative fundamentals but oversold conditions produce headwinds

EURGBP holds near the bottom of four-day narrow consolidation, just above multi-month low at 0.8361 (the lowest since May 2025).

Near-term action remains firmly in red following Monday’s strong upside rejection and subsequent weakness (bearish daily candle with long upper shadow), reflecting negative signal from economic data as French consumer confidence fell to the lowest since 2013 in October.

Traders await release of the first UK budget of PM Burnham’s government on Wednesday and ECB’s policy meeting on Thursday, at which the central bank is widely expected to remain on hold.

Fragile financial and political situation, particularly in France also contributes to Euro’s negative outlook, as surging borrowing costs in several bloc’s large economies, will be difficult task for the ECB too.

Technical picture on daily chart remains bearish but also strongly oversold that may produce more headwinds to larger bears, however the pair remains on track for the biggest monthly loss since July 2022.

Firm break lower will open immediate targets at 0.8345/40 (July/Aug 2022 lows), guarding more significant 0.8220/10 zone (Dec 2024 low / 50% retracement of 0.6949/0.8499, 2015/2020 rally).

Falling 10DMA (0.8401) marks initial resistance (also current range top), followed by descending 20DMA (0.8440) and broken Fibo (0.8467).

Res: 0.8400; 0.8436; 0.8454; 0.8465
Sup: 0.8340; 0.8300; 0.8220; 0.8200