The EUR/GBP currency pair is trading lower, testing support at the previous resistance area of 0.8585, following mixed macroeconomic data from the Eurozone on Monday [1]. The Euro failed to sustain gains above the 0.8600 level last week and is now consolidating just above this key support, with technical indicators such as the Relative Strength Index (RSI) on the 4-hour chart easing back toward 51 and the MACD turning slightly negative, suggesting fading upside momentum and a lack of clear directional bias [1].
On the economic data front, Destatis reported that the Eurozone's Gross Domestic Product (GDP) for the second quarter was revised upward to 0.6% from the previously estimated 0.4%, marking a notable improvement from the first quarter's 0.1% growth. Year-over-year, GDP growth was also revised to 1.2% from 1% [1]. However, this positive revision was offset by disappointing German Industrial Production figures, which showed a 1.1% decline in July compared to market expectations of a 0.3% increase. Additionally, June's factory output was revised down to 0% from a previously estimated 0.2% rise, casting doubt on the Eurozone's growth outlook and exerting negative pressure on the Euro [1].
In the UK, the Lloyds Housing Price Index indicated a contraction in property prices for August, contrary to expectations. Despite this, the data did not have a significant impact on the Pound's performance [1].
From a technical perspective, a break below the 0.8585 support could expose the 0.8565 area, where a trendline from mid-August lows intersects with the September 2 trough. A move below this level would negate the recent upside trend. On the upside, resistance is seen at last week's high of 0.8607, with further barriers at the June 29 and 26 peaks of 0.8632 and 0.8651, respectively [1].
According to the latest percentage change table, the Euro was the strongest against the US Dollar today, gaining 0.09%, but lost 0.06% against the Pound [1].
CONCLUSION
Mixed Eurozone data, with an upward GDP revision but weak German factory output, has left the EUR/GBP pair under pressure and testing key support levels. Technical indicators suggest consolidation, and the market is closely watching for a decisive move below 0.8585 or a rebound toward resistance. The overall market sentiment remains cautious amid conflicting economic signals.