EUR / GBP clears losses after finding support at 0.8560, maintains bullish tone

• The euro is up for the third day in a row against the pound, although it is still below 0.8600.
• The bullish momentum still stands for EUR / GBP, ahead of the BoE.

The EUR / GBP maintains its bullish tone in the short term and is rising for the third day in a row, although on Tuesday without marking new weekly highs and still remaining below 0.8600. It is trading at 0.8580 / 85, having found support at 0.8560.

The euro is stronger and erased daily losses against the pound, approaching Monday’s peak of 0.8594, close to the important level of 0.8600. In case of asserting itself above this last level, more rises would be expected. On the contrary, a rejection there and a return below 0.8550, would mark the difficulties of the euro in extending the raises.

The pound has weakened in recent days, possibly affected by the climate of risk aversion in the run-up to the meeting of the Bank of england (BoE). On Thursday the central bank will announce its decision. No changes in monetary policy are expected, the focus will be on the statement and the vote.

In recent days, the expectation has turned to be in favor of a policy support with a bias in favor of flexibility (dovish), and not pointing to an adjustment. The recent slump in equity markets, plus current UK energy supply and price issues, have favored expectations for the BoE to take the rise in inflation more calmly.

Before Thursday of the BoE, it will be on Wednesday of the Federal Reserve, which can have a wide impact on the market, which can include the EUR / GBP.

Technical levels