EUR/GBP turns negative ahead of UK GDP, could be eyeing 200-DMA

The EUR/GBP pair erased its Asian trading session gains to 0.7605 and turned negative to 0.7580 on renewed buying interest across GBP pairs ahead of the revised estimate of first quarter UK GDP growth.

The UK’s GDP figures for the first quarter is expected to match the initial estimate and come-in to show 0.4% Q-o-Q growth. A surprisingly upward revision would act as a catalyst to boost demand from the British Pound. Sterling continues to outperform the shared currency on receding 'Brexit' fears and when coupled with strong macro numbers would continue to support the relative out-performance of the British Pound.

From technical perspective, rejection from 0.7600 immediate round figure mark resistance and a subsequent break below Wednesday's low would point to additional near-term pain for the EUR/GBP bulls.

Technical levels to watch

Below yesterday's low support near 0.7565, the pair could immediately drop to test the very important 200-day SMA support near 0.7520, below which the pair would remain vulnerable to continue with its downward trajectory in the near-term.

On the upside, momentum above 0.7600 round figure mark now seems to confront strong resistance near 0.7645-50 area. Even if the pair manages to clear this immediate barrier any further recovery now seems to be restricted by a strong resistance near 0.7700 handle.