EUR/GBP Remains Under Pressure from Weak Fundamentals Despite Oversold Conditions

EUR/GBP remains pinned near the lower end of a four-day consolidation range, hovering just above the multi-month low at 0.8361, its weakest level since May 2025.

The near-term outlook continues to favor the downside after Monday’s sharp rejection from higher levels, which produced a bearish daily candlestick with a long upper shadow. The move reflects deteriorating sentiment toward the euro, reinforced by weaker economic data, including French consumer confidence falling to its lowest level since 2013 in October.

Investor focus now shifts to two key events later this week: the first budget announcement from Prime Minister Burnham’s government in the UK on Wednesday and the European Central Bank policy meeting on Thursday. While the ECB is widely expected to leave interest rates unchanged, market participants will closely watch policymakers’ guidance for clues on the future policy path.

The euro’s outlook also remains clouded by ongoing financial and political uncertainties across the bloc, particularly in France. Rising borrowing costs in several major eurozone economies continue to present a significant challenge for policymakers and add to concerns over the region’s growth prospects.

From a technical perspective, the daily chart remains firmly bearish, although heavily oversold conditions suggest that downside momentum could become increasingly difficult to sustain. Even so, the pair remains on track to post its largest monthly decline since July 2022.

A decisive break below current levels would expose the 0.8345/40 region, marked by the July and August 2022 lows, ahead of the more significant 0.8220/10 support zone, which combines the December 2024 low with the 50% retracement of the broader 0.6949–0.8499 rally.

On the upside, initial resistance is seen at the falling 10-day moving average near 0.8401, which also caps the current consolidation range. Additional barriers emerge at the descending 20-day moving average around 0.8440 and the former Fibonacci support at 0.8467, now acting as resistance.

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