- The pound resumes gains against the euro on Thursday.
- EUR/GBP accumulates five falls in the last six trading days.
- Confirmation below 0.8350 would enable further downside.
EUR/GBP is falling on Thursday and reached 0.8344, the lowest intraday level since February 3rd. The cross remains in the low zone with a bearish tone and testing a key support.
In case of clear affirmation below 0.8350, the negative tone for the euro would be reaffirmed. The next support is located at 0.8335, followed by 0.8310. Should it manage to hold above 0.8350, the euro could feign a recovery. Resistances are at 0.8380, followed by 0.8400.
BoE vs ECB
Expectations of a rise in the interest rate by the Bank of England they remain firm. Wednesday’s higher-than-expected UK inflation data points in that direction.
On the side of European Central Bank, the rally in the euro that began with the change in the direction of the central bank, towards a bias in favor of some monetary adjustment, is being left behind. Martins Kazaks, a member of the ECB’s Governing Council, said on Wednesday that the bank may raise rates in 2022, adding more voices to the recent “hawkish” shift.
This monetary policy divergence will continue to be important for the EUR/GBP. To this can be added the impact of the crisis on the Ukrainian border, which should affect the euro more than the pound, and if it intensifies, generate more noise.
Technical levels
Source: Fx Street
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
