Date: 07 Feb 2019

As British Prime Minister May travels to Brussels on Thursday to discuss the Brexit dispute with EU leaders, the Bank of England meets to decide on interest rates.

It is still unclear how the political situation will develop. In any case, it will remain exciting. With uncertainty on two fronts, it’s time to take a closer look at the EURGBP pair.

From a chart technical perspective, the candle on Tuesday was used to overcome last week’s high.

In the range of 0.880, there is a significant structural level that the pair has failed to break over the last two days. If the market bounces off it and the Bears gain the upper hand, then there may be support in the 0.873 range. If the market falls further, the area around 0.864 could serve as the next support zone.

The fact that the MACD has crossed its trigger line from bottom to top could have a positive effect on further rising prices. The histogram is in positive territory.

If the pair can push up from the resistance region at 0.880, a vital resistance level lies in the range around 0.885. If this is breached sustainably, the path to the 0.891 regions could be bright.

However, it all depends on how the market reacts to the Brexit developments, the interest rate decision released at 12:00 p.m GMT and Governor Carney’s speech at 12:30 p.m. GMT. All this can easily change the direction of the markets.

 

EUR/GBP Daily Chart | Source: ActivTrader

EUR/GBP Daily Chart | Source: ActivTrader

 

Written by Daniel Schuetz, External Analyst

 

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