#EURGBP @ 0.89465 Bank of England buys gilts to stabilize the bond market. (Pivot Orderbook analysis)

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• Bank of England buys gilts to stabilize the bond market.
• Pound strengthens after the initial impact of BoE announcement.
• EUR/GBP unable to hold firm above 0.9000.

The pair currently trades last at 0.89465.

The previous day high was 0.9004 while the previous day low was 0.8897. The daily 38.2% Fib levels comes at 0.8938, expected to provide support. Similarly, the daily 61.8% fib level is at 0.8963, expected to provide resistance.

The EUR/GBP is hovering around 0.8940 practically flat for the day after moments of extreme volatility following a surprise announcement from the Bank of England. The cross bottomed at 0.8838, the lowest in three days and then jumped to 0.9066, before pulling back. GBP/USD rose from 1.0535 to levels above 1.0900.

The Bank of England announced it will by long-term gilts and delayed the beginning of sales. The collapse in UK bonds forced action from the BoE to avoid more tensions across financial markets. The BoE said it purchased on Wednesday £1.025B of gilts.

The decision was a positive for equity markets and also made bond yields pullback across the globe. Still the situation in the UK is still complex. The blowup in UK bonds and the quick depreciation of the pound also triggered political instability to the new administration of PM Liz Truss. Her tax-cutting plan is being criticized.

Markets continue to digest BoE’s announcement. The current calm will likely be short-lived and EUR/GBP continues to look for the next equilibrium level. So far, that area appears to be under 0.9000. A close above could open the doors to more gains.

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.8939 at the time of writing. Pair opened at 0.8938 and is trading with a change of 0.01 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 0.8725, 50 SMA 0.8558, 100 SMA @ 0.8547 and 200 SMA @ 0.8462.

The previous day high was 0.9004 while the previous day low was 0.8897. The daily 38.2% Fib levels comes at 0.8938, expected to provide support. Similarly, the daily 61.8% fib level is at 0.8963, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.8888, 0.8839, 0.8781
• Pivot resistance is noted at 0.8996, 0.9054, 0.9104

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