EUR/GBP stuck in a tight range as traders observe the war

• EUR/GBP has spent Friday's session in a narrow range in the mid-0.8500s, barely changing on the day.
• Eurozone Q2 GDP and employment matched forecasts, giving neither the Euro nor the Pound an edge.
• With the data out of the way, the market is waiting for clearer signals from the Middle East war.

EUR/GBP has traded in a tight range around the mid-0.8500s on Friday, little changed on the day. The latest Eurozone figures came in close to forecasts, and they did nothing to push the pair out of the range it has held all week.

Eurozone Gross Domestic Product (GDP) grew 0.4% in the second quarter, matching expectations, with the annual rate at 1%. Employment rose 0.1% on the quarter, also as forecasted. Nothing in the release surprised, and the numbers are backward-looking, so the reaction was slight.

The pair has been going sideways for several sessions with the Euro (EUR) steadying after an earlier run of losses. United Kingdom (UK) data earlier in the week also landed close to forecasts, which left the Pound (GBP) without a clear lead of its own. With both sides matching expectations, little has separated them.

The Middle East war keeps a hand on energy prices, and through them on the inflation picture the European Central Bank (ECB) is weighing. Until that situation gets clearer, traders have little reason to commit to a direction.

Short-term technical analysis:

On the 4-hour chart, EUR/GBP trades at 0.8548. The cross is hovering just under a cluster of nearby resistance with the 100-period Simple Moving Average (SMA) at 0.8557 capping the topside together with horizontal barriers at 0.8549 and 0.8550. Price holds marginally above the 20-period SMA at 0.8545, which, alongside the latest relative strength index (RSI) reading near 49, suggests a consolidative, range-bound bias rather than a clear directional move.

On the downside, immediate support is seen at the 20-period SMA and horizontal level around 0.8545, ahead of a lower floor at 0.8541. On the topside, EUR/GBP would need to reclaim the nearby resistances at 0.8549 and 0.8550 to challenge the 100-period SMA at 0.8557, a break above which would be needed to re-open a more constructive short-term outlook.

(The technical analysis of this story was written with the help of an AI tool. Know more.)