EURGBP declined slightly after the BOE monetary policy. Intraday bias remains bearish as long as resistance 0.8380 holds. It hit a low of 0.83132 at the time of writing and is currently trading around 0.83190.
The Bank of England (BoE) has cut interest rates from 5% to 4.75%. This decision was made by the Monetary Policy Committee, with most members agreeing on the cut, while one member wanted to keep rates the same. This is only the second time rates have been reduced since 2020. The cut comes as the government expects inflation to rise and the economy to grow. Governor Andrew Bailey stressed the importance of being careful with future cuts to keep inflation near the target of 2%.
Technical Analysis
The pair is currently trading below the 34- and 55-EMA on the 4-hour chart.
- Bearish Trend Confirmation: If the price stays below 0.8300, it will confirm an intraday bearish trend. A drop to 0.8280 or 0.8235 is likely.
- Near-Term Resistance: Current resistance is around 0.83650. If it breaks above, we could see movement toward 0.8505/0.8540. The bearish outlook would be invalidated only if the price goes above 0.8500.
Indicator Analysis (4-hour chart)
- CCI (50): Bearish
- Average Directional Movement Index: Neutral
Trading Recommendation
It may be wise to sell on rallies around 0.8338-340, with a stop loss set at 0.8365 and a target price of 0.8235.
