Today our focus will remain on Europe as we take a look at the EUR/GBP currency pair. Since the end of January the pair has been steadily climbing up, largely propelled by the political chaos surrounding Brexit.
The British pound is under the influence of Brexit negotiations. Members of UK Parliament have voted and urged the Prime Minister to not go for a hard Brexit, and investors seem to have confidence that a deal will come into effect in one way or another before the deadline. Despite last week’s fluctuations, the pound is expected to stabilize. Moreover, today we will hear from the Bank of England on monetary policy and interest rates, and we would also receive their inflation report. With strong data the pound can certainly recover.
The bad news continue for everyone who wishes to see a strengthening in the euro. Fundamental data from the eurozone is disappointing across the board, affected by the overall international economic slowdown observed around the globe. In this climate it is expected that the ECB will remain true to their dovish approach and there likely won’t be any incentives for growth for the euro.
In terms of the daily chart, today we have a pivot point for the pair located at 0.8788, with the pair currently trading above it. The daily support levels lie at 0.8768 and 0.8750. The daily resistances are at 0.8807 and 0.8826. The indicators of technical analysis are giving us some mixed signals, but lean towards a strong buy recommendation.
