- Euro regains lost ground against the pound.
- Rally pos BoE is lagging behind taking a boost from the pound.
- Increase the chances of Draghi being Italian premier.
The EUR / GBP rises on Monday for the second day in a row, recovering after falling to 0.8737 on Friday, the lowest level since May 2020. The cross rose to 0.8792 and then retreated slightly. It is trading at 0.8780 / 85, about 15 pips above Friday’s close.
The euro remains in recovery mode against the pound. The momentum of the recent rally of the British currency is already being discounted and had been the meeting of the Bank of england, discarding negative interest rates in the short to medium term.
In Europe, the novelty of the moment has to do with Italy where Mario Draghi seems to be heading to become the next prime minister. This would be a positive sign for markets that are optimistic about the figure of the former president of the European Central Bank.
Technical overview
The chart still shows EUR / GBP in a marked downtrend, although the pressure eased with the recent rally. To the upside, 0.8800 appears as important resistance and then 0.8860 will follow. If it rises above the latter, the bearish bias would be in jeopardy.
On the downside in the short term, the first support appears at 0.8775 and then at 0.8755 before last week’s bottom at 0.8735 / 40.
Technical levels
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