The EURGBP pair has started to move back towards the 0.8500 after breaking above its 200-day moving average once again after the extremely dovish policy statement from the Bank of England on Thursday.
The Bank of England believes came out swinging on Thursday, as talked down the chances of a big economic downturn, driven primarily, by soaring energy prices, which is set to intensify and will push the UK economy into recession later this year according to the central bank.
The Bank now think that inflation is heading for double-digits, peaking above 10% in the autumn, at a time when the UK economy is being hit by a series of shocks. The upheaval is being caused by a succession of lockdowns to contain Covid-19 and has been followed by Russia’s invasion of Ukraine.
Bank of England governor Andrew Bailey said on how the rising cost of living is hitting the poor the hardest “This inflation is particularly concentrated in what you might called staple goods”
The current move higher in the EURGBP is being driven by a clear combination of British pound weakness and rebound in EURUSD pair from the 1.0400 level since last week.
Most traders would agree that the EURGBP pair is now showing signs of doing much higher after moving above its 200-day moving average, and that the EURGBP pair may have bottomed.
The ActivTrader platform shows that bearish sentiment is still at moderately high levels, with some 63 percent of traders still expecting more upside in the EURGBP pair.
This current high level of bearishness is however warning that the EURGBP pair might be getting ready to explode to the upside. A move above 0.8600 could be turbo charge the next upside move.
EURGBP Short-term Technical Analysis
The four-hour time frame shows that the EURGBP pair is technically bullish now over the short-term with the price trading well above its 200-period MA, around the 0.8350 level. A bullish inverted head and shoulders pattern has been activated also.
Lower time frame analysis currently shows the EURGBP pair could rally towards the 0.8600 level, according to the size of the inverted head and shoulders pattern. These patterns are typically very bullish.
See real-time quotes provided by our partner.
EURGBP Medium-term Technical Analysis
The daily time frame shows that the EURGBP pair is trading inside a large descending broadening wedge pattern, with the pair now above its 200-day MA and trading towards the top of the wedge.
The top of the bullish falling broadening wedge pattern is close to be tested to the upside. Traders should note that bullish falling broadening wedge patterns are amongst the most bullish reversal patterns and have a high probability of playing out. The pattern is predicting a coming test towards the 0.8600 area.
See real-time quotes provided by our partner.
A comprehensive website for traders, both experienced and new! Checkout our content and learn how to invest and speculate in the markets using margin traded products. Our team of educators has extensive experience and is here to help. Enjoy!
© 2020 YouTrading UK - Leaders in Trader Training.
Cookie | Duration | Description |
---|---|---|
__cfduid | 1 month | The cookie is used by cdn services like CloudFare to identify individual clients behind a shared IP address and apply security settings on a per-client basis. It does not correspond to any user ID in the web application and does not store any personally identifiable information. |
_wpfuuid | 11 years | This cookie is used by the WPForms WordPress plugin. The cookie is used to allows the paid version of the plugin to connect entries by the same user and is used for some additional features like the Form Abandonment addon. |
cf_use_ob | This cookie is set by the provider Cloudflare content delivery network. This cookie is used for determining whether it should continue serving "Always Online" until the cookie expires. | |
cookielawinfo-checbox-analytics | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics". |
cookielawinfo-checbox-functional | 11 months | The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional". |
cookielawinfo-checbox-others | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other. |
cookielawinfo-checkbox-advertisement | 1 year | The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Advertisement". |
cookielawinfo-checkbox-necessary | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary". |
cookielawinfo-checkbox-performance | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance". |
viewed_cookie_policy | 11 months | The cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data. |
Cookie | Duration | Description |
---|---|---|
YSC | session | This cookies is set by Youtube and is used to track the views of embedded videos. |
Cookie | Duration | Description |
---|---|---|
_ga | 2 years | This cookie is installed by Google Analytics. The cookie is used to calculate visitor, session, campaign data and keep track of site usage for the site's analytics report. The cookies store information anonymously and assign a randomly generated number to identify unique visitors. |
_gid | 1 day | This cookie is installed by Google Analytics. The cookie is used to store information of how visitors use a website and helps in creating an analytics report of how the website is doing. The data collected including the number visitors, the source where they have come from, and the pages visted in an anonymous form. |
Cookie | Duration | Description |
---|---|---|
_fbp | 3 months | This cookie is set by Facebook to deliver advertisement when they are on Facebook or a digital platform powered by Facebook advertising after visiting this website. |
fr | 3 months | The cookie is set by Facebook to show relevant advertisments to the users and measure and improve the advertisements. The cookie also tracks the behavior of the user across the web on sites that have Facebook pixel or Facebook social plugin. |
IDE | 1 year 24 days | Used by Google DoubleClick and stores information about how the user uses the website and any other advertisement before visiting the website. This is used to present users with ads that are relevant to them according to the user profile. |
test_cookie | 15 minutes | This cookie is set by doubleclick.net. The purpose of the cookie is to determine if the user's browser supports cookies. |
VISITOR_INFO1_LIVE | 5 months 27 days | This cookie is set by Youtube. Used to track the information of the embedded YouTube videos on a website. |
Cookie | Duration | Description |
---|---|---|
_gat_UA-42160853-2 | 1 minute | No description |
cf_ob_info | No description | |
CONSENT | 16 years 8 months 3 days 6 hours 2 minutes | No description |