#EURGBP @ 0.86702 The euro remains negative on the day, capped below 0.8700. (Pivot Orderbook analysis)

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• The euro remains negative on the day, capped below 0.8700.
• The Sunak effect keeps supporting the pound’s rally.
• EUR/GBP expected to appreciate towards 0.9000 – SocvGen.

The pair currently trades last at 0.86702.

The previous day high was 0.8758 while the previous day low was 0.8665. The daily 38.2% Fib levels comes at 0.87, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8722, expected to provide resistance.

The euro ticked up from the one-week lows at 0.8645 witnessed earlier on Wednesday, although it remains negative on the daily chart. Bullish attempts are capped below 0.8700 and the pair consolidates losses after retreating from 0.8770 highs earlier this week.

Sterling remains moderately bid, still buoyed by the positive market reaction to Rishi Sunak becoming UK’s Prime minister and his pledge to restore economic stability. The delay of a keenly awaited fiscal plan, which was due on October 31, to mid-November has not dented investor’s appetite for the pound, which has rallied to fresh six-week highs against the US dollar

The euro, however, has managed to trim losses with all eyes on the European Central Bank’s monetary policy decision, due on Thursday. The bank is widely expected to hike rates by 75 basis points for the second consecutive time, which has offered some support to the euro.

Kit Juckes, Chief Global FX Strategist at Société Générale sees the pair returning to 0.90: “With the economy surely already in recession and set to suffer from possibly even tighter fiscal policy, sterling is unlikely to enjoy much more of a relief bounce and over time, EUR/GBP is likely to meander slowly up to 0.90 or so.”

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.867 at the time of writing. Pair opened at 0.8688 and is trading with a change of -0.21 % .

The pair is trading below its 20 Daily moving average @ 0.8743, below its 50 Daily moving average @ 0.8682 , above its 100 Daily moving average @ 0.8593 and above its 200 Daily moving average @ 0.8498

The previous day high was 0.8758 while the previous day low was 0.8665. The daily 38.2% Fib levels comes at 0.87, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.8722, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.865, 0.8611, 0.8557
• Pivot resistance is noted at 0.8742, 0.8796, 0.8834

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