EUR/GBP Soars on Policy Divergence: Bullish Trend Sustained Amid BoE's Dovish Shift

EURGBP jumped sharply on policy divergence between the BOE and ECB. Intraday bias remains bullish as long as support 0.8580 holds. It hits an intraday high of 0.8646 and is currently trading around 0.86802.

The Bank of England is signaling imminent interest rate cuts, with the next decision set for August 7, 2025, and Governor Andrew Bailey indicating a "downward" trajectory, especially if economic and job market weakness persists; economists largely expect a 25-basis-point reduction to 4.00% in August, with potential for another cut by year-end to around 3.75%, though the BoE remains data-dependent to balance economic support with inflation control.

Technical Analysis

The pair is currently trading above the 55 and 200-EMA and 365-EMA on the 4-hour chart.

Bearish Trend Confirmation: Any break below 0.8580 confirms an intraday bearish trend. A drop to 0.8520/0.8480/0.84425/0.8400/0.8378/0.8340/0.8300 is likely.

Near-Term Resistance:  The near-term resistance is around 0.8700. Any violation above will take the pair to 0.8765/0.8800.

Indicator Analysis (4-hour chart)

CCI (50): Bullish

Average Directional Movement Index:  Bullish

Trading Recommendation

It  is good to buy on dips around 0.8650 with SL around 0.8600  for a TP of 0.8765.

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