The euro appreciates for the third day in a row to test three-week highs at 0.8780. (Pivot Orderbook analysis)

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• The euro appreciates for the third day in a row to test three-week highs at 0.8780.
• BoE’s dovish rhetoric has increased downward pressure on the pound.
• EURGBP: Breach of 0.8780 resistance would cancel the downward trend from late-September highs.

The pair currently trades last at 0.8777.

The previous day high was 0.8743 while the previous day low was 0.8608. The daily 38.2% Fib levels comes at 0.8692, expected to provide support. Similarly, the daily 61.8% fib level is at 0.866, expected to provide support.

The euro appreciated against the pound for the third consecutive day, extending its rebound from week lows at 0.8590 to test October 21 high at 0.8780 which, so far, remains firm.

The pound has been trading under strong bearish pressure this week, which has helped the EURGBP to rally nearly 2.4%, on the back of the dovish message by the Bank of England and the bleak economic perspectives ahead for the UK.

On Thursday, BoE President Andrew Bailey sent the pound tumbling at the press release held following the monetary policy decision, in spite of the 0.75% hike previously delivered by the bank. Bailey signaled to softer rates over the next months and warned that the country might have already entered a recession that could last two years and cause a 2.9% economic contraction.

From a technical perspective, EURGBP bulls gained traction on Friday after confirmation above the 50-day SMA, at 0.8700, now acting as support to attempt an assault to the October 21 high at 0.8780.

Above here, the pair would have canceled the downward trend from late September highs, opening the path towards 0.8965 (Oct. 12 high) and 0.9000 psychological level.

On the downside, immediate support lies at the mentioned 50-day SMA, at 0.8700 with the next targets below there at 0.8650 (Oct 27 high) and 0.8570 (October 28 and 31 lows).

Technical Levels: Supports and Resistances

EURUSD currently trading at 0.8777 at the time of writing. Pair opened at 0.8731 and is trading with a change of 0.53 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 0.8694, 50 SMA 0.8708, 100 SMA @ 0.8598 and 200 SMA @ 0.8508.

The previous day high was 0.8743 while the previous day low was 0.8608. The daily 38.2% Fib levels comes at 0.8692, expected to provide support. Similarly, the daily 61.8% fib level is at 0.866, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.8645, 0.8559, 0.851
• Pivot resistance is noted at 0.878, 0.8829, 0.8915

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