EURGBP lost its shine on policy divergence between the ECB and BOE. Intraday bias remains bearish as long as resistance 0.8650 holds. It hit an intraday low of 0.84872 and is currently trading around 0.85535.
In April 2025, the ECB lowered its deposit rate by 25 basis points to 2.25%, its sixth consecutive cut since June 2024, and lowered the 2025 Eurozone growth forecast to 0.9% on softer US tariff risks and subdued inflation. This aggressive loosening is the opposite of the Fed's prudence, widening the USD-EUR yield difference and fueling expectations for further ECB cuts in 2025. U.S. tariffs would halve Eurozone growth, and while core inflation remains near 2%, falling energy prices and sluggish demand limit the upside. Consequently, the trade-weighted euro index has declined approximately 3% since March 2025, with EUR/USD lingering at 1.10–1.14, bogged down by dollar strength and ECB dovishness
Technical Analysis
The pair is currently trading below the 34- and below 55-EMA on the 4-hour chart.
Bearish Trend Confirmation: Any break below 0.8480 confirms an intraday bearish trend. A drop to 0.8450/0.8378/0.8300 is likely.
Near-Term Resistance: The near-term resistance is around 0.8550. Any violation above will take the pair to 0.8605/ 0.8660/0.8765/0.8800.
Indicator Analysis (4-hour chart)
- CCI (50): Bearish
- Average Directional Movement Index: Bearish
Trading Recommendation
It is good to sell on rallies around 0.8548-55 with SL around 0.86050 for a TP of 0.8380.
