#EURGBP @ 0.88596 gains strong positive traction and snaps a seven-day losing streak to a two-week low. (Pivot Orderbook analysis)

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• EUR/GBP gains strong positive traction and snaps a seven-day losing streak to a two-week low.
• The softer UK CPI print weighs on the Sterling and prompts an aggressive short-covering move.
• Bets for additional jumbo interest rate hikes by the ECB underpin the Euro and remain supportive.

The pair currently trades last at 0.88596.

The previous day high was 0.8848 while the previous day low was 0.8804. The daily 38.2% Fib levels comes at 0.8821, expected to provide support. Similarly, the daily 61.8% fib level is at 0.8831, expected to provide support.

The EUR/GBP cross catches aggressive bids on Wednesday and snaps a seven-day losing streak to a two-week low, around the 0.8800 mark touched the previous day. The cross sticks to its strong gains through the early part of the European session and is currently placed near the 0.8865-0.8870 region, or the top end of the weekly range.

The British Pound weakens across the board in reaction to softer-than-expected UK consumer inflation figures and triggers an intraday short-covering move around the EUR/GBP cross. In fact, the UK Office for National Statistics reported that the headline CPI declined by 0.6% in January, more than the 0.4% fall anticipated. Adding to this, the yearly rate decelerated from 10.5% in December to 10.1% during the reported month, again missing estimates for a reading of 10.3%.

More importantly, Core CPI, which excludes seasonally volatile products such as food and energy, came in at 5.8% YoY as compared to the 6.3% previous and 6.2% expected. The data could ease pressure on the Bank of England to deliver aggressive rate hikes, especially after the strong UK wage growth figures on Tuesday. Apart from this, bets for additional jumbo rate hikes by the European Central Bank (ECB) underpin the Euro and provide an additional lift to the EUR/GBP cross.

The aforementioned fundamental backdrop supports prospects for a further near-term appreciating move. That said, the lack of follow-through buying warrants some caution for bullish traders. Hence, it will be prudent to wait for a sustained strength back above the 0.8900 mark before confirming that the EUR/GBP pair’s recent pullback from the highest level since September 2022 has run its course.

Technical Levels: Supports and Resistances

EURGBP currently trading at 0.8866 at the time of writing. Pair opened at 0.8818 and is trading with a change of 0.54 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 0.8832, 50 SMA 0.8794, 100 SMA @ 0.8746 and 200 SMA @ 0.8647.

The previous day high was 0.8848 while the previous day low was 0.8804. The daily 38.2% Fib levels comes at 0.8821, expected to provide support. Similarly, the daily 61.8% fib level is at 0.8831, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.8799, 0.878, 0.8755
• Pivot resistance is noted at 0.8843, 0.8867, 0.8886

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