Global macro overview for 03/08/2016:
The PMI Services data from the United Kingdom has just been published and they came put just as expected at 47.4 (47.4 expected vs. 47.4 prior). The number below the fifty mark means materials purchased by managers are decreasing and the future outlook is less favorable. This is the second reading since Brexit and the second consecutive one below fifty marks. Nevertheless, it is worth to mention, that the down trend in PMI Services data started at the beginning of 2014 and hasn't been terminated yet. However, the latest PMI data show UK services sector shrank at the fastest pace on record in July (economy contracting at the fastest rate since 2009). In conclusion, the Brexit has accelerated the pressure on the BoE to cut the interest rates in order to stimulate the economy even more.
Now let's take a look at the EUR/GBP technical picture on the daily time frame. After a false breakout above the technical resistance at 0.8469, the bears seem to have gained the control over this market as the price approaches the next support at 0.8249. Nevertheless, the series of higher highs and higher lows is still present, so the mid-term outlook for this pair is still bullish.
