Global macro overview for 31/03/2017:

The German Unemployment Rate for the month of March declined to 5.8%, the lowest level in 10 years. Moreover, the Unemployment Change (measures the change in the number of unemployed people during the previous month) declined 30k people, while the market participants expected a decline of only 10k. The number was even better than the last month 17k decline in unemployment people. The other good news from Germany is the increase in Retail Sales of 1.8% on month-to-month basis (versus 0.7% expected and -1.0% prior). Nevertheless, yesterday's inflation data from Germany and France were worse than expected. Consumer inflation in European Union slowed from 2.1% to 1.5%, while a forecast was a decline of 1.8%. Core inflation was only 0.7% higher than a year ago, while the market participants expected a reading of 0.8 %. In conclusion, the unemployment is at the record low, the sales are increasing, but the weakening of inflationary pressure in March does not give grounds for the market to discount the rapid normalization of policy by the ECB.

Let's now take a look at the EUR/GBP technical picture at the H4 time frame. The price had retraced 61% of the previous swing high and now is trying to bounce/reverse higher and break out above the technical resistance zone between the levels of 0.8603 - 0.8613. The breakout above this level will open the road towards the next technical resistance seen at the level of 0.8661. The oversold market conditions support the bullish bias.