EURGBP Rebounds
EURGBP little unchanged after the ECB left interest rates unchanged as expected. The central bank will continue to purchase 20 billion euros a month in bonds. ECB also announced the launch of a review of its monetary policy strategy.
Christine Lagarde in the press conference noted that Inflation is expected to increase over medium-term, and the conclusion of phase one between the US and China has slightly reduced if not vanished uncertainty. December is a probable date for the communication of strategy.
The British pound attracted bids the last days after stronger data out of the UK economy. Now the possibilities of a rate cut in January by the Bank of England dropped bellow 50% pushing GBP to higher levels.
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EURGBP is 0.05% higher at 0.8444 making an attempt to stabilize after yesterday’s steep losses. The pair is trading close to monthly lows as the momentum is still negative.
On the upside, first resistance for the pair will be met at 0.8457 the daily high. The next resistance stands at 0.85007 the 50-day moving average. A break above that level will pave the way for the next resistance at 0.8596 the high from January 14th.
On the other side, immediate support for the EURGBP pair stands at 0.8428 the daily low. Next level to the downside for bears would be the December 17th low at 0.8357. If the GBPUSD breaks that level then the next support will be met at 0.8274 the low from December 13th.