ING analysts see EUR/GBP heading toward 0.8400 as sterling's short squeeze continues. The pound's rally has room to run, they said, with momentum still strong.
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ING analysts said the pound's short squeeze has room to run, with EUR/GBP potentially sliding toward 0.8400 if current momentum holds.
EUR/GBP traded at 0.848982, up 0.22% on the session. GBP/USD stood at 1.347921, down 0.44%. EUR/USD was at 1.144361, down 0.23%.
The short squeeze reflects a rapid unwind of bearish sterling positions after weeks of sustained gains. ING wrote that positioning data shows crowded shorts, and a further squeeze could push the cross lower. The 0.8400 level represents a key technical zone from early 2022, the bank noted.
Sterling's rally against the dollar has been sharp, with GBP/USD rising above 1.34. For more on the pair, see the GBP/USD profile. The broader forex market analysis section tracks positioning shifts across major crosses.
ING's call is based on momentum signals rather than a shift in fundamental views on the UK economy. The bank said a break below 0.8450 would confirm the squeeze has further to go.
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