EUR/GBP drops to one-month low amid renewed political unrest in Germany

EUR/GBP weakened on Tuesday after Germany’s Merz unexpectedly failed to secure parliamentary support to become chancellor in the first round of voting.

The pair slid to a one-month low, breaching key support at 0.8480 (the 61.8% Fibonacci retracement of the 0.8320–0.8738 rally and a key daily base level).

A decisive break below this level is needed to confirm renewed bearish momentum and signal the continuation of the broader downtrend from the 2025 peak at 0.8738, posted on April 11, now extending into its fourth consecutive week.

Although the bears encountered some resistance at the 0.8480 pivot—evidenced by a quick bounce from the new low of 0.8461—the technical outlook on the daily chart remains weak and favors further downside.

Near-term price action continues to be capped by the falling 10-day moving average, which crossed below the 20-day moving average last week, while 14-day momentum is sinking deeper into negative territory.

A clear drop below 0.8480 would open the way toward the 55-day moving average at 0.8430, followed by the 76.4% Fibonacci level at 0.8416, which guards the confluence of the 100- and 200-day moving averages around 0.8389.

Any upside attempts should remain limited below the 10DMA at 0.8509 to keep bearish pressure intact, though continued hesitation around the 0.8480 zone could result in prolonged consolidation.

Res: 0.8509; 0.8529; 0.8548; 0.8578
Sup: 0.8461; 0.8430; 0.8416; 0.8389