EUR/GBP has been residing in a volatile corrective structure after the impulsive bearish pressure since September. At present, the pair is expected to break below the 0.8750 support level. GBP has been quite strong amid recent economic reports whereas EUR is still struggling due to mixed economic reports. Recently, Interest Rates reports from the ECB and the UK were published. The key interest rate of the European regulator remained unchanged at 0.0% as expected. The Bank of England also announced a decision to keep the key rate unchanged at 0.50% as expected. EUR is currently looking at the long-term goals rather than gaining momentum over short-term whereas GBP is trying to have some quick gains to be in the momentum amid political and Brexit issues. Today, the eurozone’s Trade Balance report is going to be published which is expected to decrease to 24.4B from the previous figure of 25.0B. On the GBP side, today MPC Member Haldane will speak about the upcoming policies which is expected to be quite neutral in nature. Moreover, BOE Quarterly Bulletin is going to be released today as well with the remarks on market development and monetary policy decisions. The document is also expected to be neutral in nature. As for the current scenario, GBP is expected to dominate EUR in the coming days until EUR finds support from economic reports and events.
Now let us look at the technical chart. The price has been held by the dynamic level of 20 EMA for several days recently which has been quite successful as dynamic resistance. As the price remains below the 20 EMA and 0.8850 price area, the bearish bias is expected to continue further with a target towards 0.8500-50 support area in the coming days. The upcoming move is expected to be quite impulsive in nature as the Pre-breakout structure is currently unfolding.
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