#EURGBP @ 0.89552 picks up bids to reverse the post BOE pullback. (Pivot Orderbook analysis)

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for PREMIUM VERSION HERE to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level4)]

• EUR/GBP picks up bids to reverse the post BOE pullback.
• Hawkish ECB jostled with the BOE’s bond-buying plan but failed to recall the bears.
• Looming economic fears for the UK join hawkish ECBspeak to keep buyers hopeful.
• German inflation may allow traders to witness further upside with firmer HICP numbers.

The pair currently trades last at 0.89552.

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.

EUR/GBP prints mild gains around 0.8950 during Thursday’s Asian session, after a volatile day that ended on a positive note.

The cross-currency pair’s latest gains could be linked to the regional currency’s comparative strength considering the hawkish comments from the European Central Bank (ECB). However, softer yields and hopes of the UK’s more efforts to restrict trader confidence could challenge the pair bears.

That said, the Bank of England (BOE) announced a bond-buying program to defend the British Pound (GBP) on Wednesday. The details suggest that the BOE will buy bonds with a maturity of over 20 years and up to 5 billion sterling worth per auction initially. On the other hand, ECB President Christine Lagarde reiterated on Wednesday that they will continue to raise rates in the next several meetings, as reported by Reuters. There were several other ECB Governing Council members namely Olli Rehn, Peter Kazimir, and Robert Holzmann who openly favored a 0.75% rate hike in the next meeting.

Elsewhere, the US 10-year Treasury bond yields slumped the most in six months and allowed equities to consolidate recent losses, which in turn propelled the EUR and drowned the US dollar.

Looking forward, preliminary readings of Germany’s Harmonized Index of Consumer Prices (HICP) for September, expected 10% YoY versus 8.8% prior, will be important to watch for fresh impulse. Also important will be the ECBSpeak and the comments from various BOE policymakers. Above all, risk catalysts are crucial to determine short-term EUR/GBP moves.

Considering the less likely immediate end of the UK’s financial problems, the EUR/GBP prices are likely to remain firmer and can rise further if the Germany data offers a positive surprise.

A three-day-old bullish triangle restricts immediate EUR/GBP moves between 0.9030 and 0.8850.

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.8953 at the time of writing. Pair opened at 0.8938 and is trading with a change of 0.17% % .

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

[/s2If]
Join Our Telegram Group