Daily Asia-London Sessions Watchlist: EUR/GBP

National Financial Solution > Forex Trading > Daily Asia-London Sessions Watchlist: EUR/GBP

EUR/GBP may be a mover in the upcoming London session, but will there be enough to break the consolidation pattern?

Before moving on, ICYMI, today’s Daily U.S. Session Watchlist looked at an ascending channel on NZD/USD, so be sure to check that out to see if there is still a potential play!

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Fresh Market Headlines & Economic Data:

Dow ends day flat as economic comeback plays offset losses in tech

U.S. weekly jobless claims below 400,000; companies boost hiring in May

U.S. business activity growth rate accelerates to record high in May

ADP National Employment Report: Private Sector Employment Increased by 978,000 Jobs in May

ISM Services PMI for May: 64.0 vs 62.7 in April

Global economic growth hits 15-year high as rapid expansions in US and Europe offset subdued Asia region

Eurozone Services sector drives further acceleration in growth during May – IHS Markit

German service sector returns to growth in May

May sees sharp rise in French business activity as virus-related restrictions ease

Upcoming Potential Catalysts on the Economic Calendar

Japan Household spending at 11:30 pm GMT
Australia Home Loans at 1:30 am GMT (Jun. 4)
SNB Jordan speaks at 7:00 am GMT (Jun. 4)
Euro Area Construction PMI at 7:30 am GMT (Jun. 4)
U.K. Construction PMI at 8:30 am GMT (Jun. 4)
Euro Area Retail Sales at 9:00 am GMT (Jun. 4)
ECB President Lagarde speech at 11:00 am GMT (Jun. 4)

What to Watch: EUR/GBP

EUR/GBP 1-Hour Forex Chart
EUR/GBP 1-Hour Forex Chart

On the one hour chart above of EUR/GBP, we can see the pair in consolidation mode, forming what could be viewed as a descending triangle in the works. This can be a bearish signal, mainly if the support breaks around the 0.8580 handle, and it would likely turn into a bearish momentum play if the upcoming data from both the Euro area and the U.K. play out favorably for the bears.

On the calendar, we’ve got mid-tier events from both the Eurozone and the U.K. to potentially get EUR/GBP moving, but with forex traders likely to wait on the sidelines ahead of the U.S. Non-Farm Payrolls report, it’s likely that a breakout would occur unless we got a major surprise from either side of the pair.

Given that the longer-term trend is favoring the British pound over the euro at the moment, we’re watching out for a downside break of support on bullish U.K. data and/or positive updates from the pandemic front in the U.K. This would not only likely draw in technical momentum players, but fundamental ones as well.

In the off chance that the Euro area data comes out positive enough to spark a strong euro rally, then a break above the falling ‘highs’ pattern is the behavior to watch before considering a long position in the pair. Keep in mind, though, that with the major price trend and fundamental themes favoring Sterling over euro at the moment, any break higher may be quickly met by longer-term sellers looking to trade at better prices.

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