EURGBP is trading higher and may present a buying opportunity above 0.8435. Currently, the pair is around 0.83930 after hitting a high of 0.84190, showing resilience amid a flat market as investors await the U.S. presidential election results. The pound sterling remains weak, contributing to the pair's better performance, and the intraday bias stays bullish as long as support at 0.8360 holds.
Current Economic Context: The upcoming Bank of England meeting on November 7, 2024, may bring changes to monetary policy. With the current interest rate at 5% and inflation slightly above target at 2.2%, many expect a rate cut to 4.75%. Despite inflation concerns, stable unemployment and strong wage growth suggest the economy is holding up well.
Technical Analysis:
- The pair is above the 34- and 55-day EMAs on the 4-hour chart.
- Bearish Trend Confirmation: If EURGBP stays below 0.83650, it may confirm a bearish trend, possibly dropping to 0.8320 or lower.
- Near-Term Resistance: Key resistance is at 0.8450. Breaking this level could push prices toward 0.8505/0.8540, while a move above 0.8500 would invalidate the bearish outlook.
Indicator Analysis (4-hour chart):
- CCI (50)- Bullish
- Average Directional Movement Index: Neutral
Trading Recommendation: Consider buying on dips around 0.83780, with a stop-loss at 0.8350 and a target price of 0.8500.
