Market news

16 December 2021

EUR/GBP Price Analysis: Justifies bullish Doji ahead of ECB, BOE duet

  • EUR/GBP extends bounce off monthly low, grinds higher recently.
  • Bullish candlestick above 100-DMA joins upbeat MACD signals to keep buyers hopeful.
  • 61.8% Fibonacci retracement, 200-DMA challenges upside momentum.
  • BOE, ECB both faces Omicron risks to hawkish expectations backed by inflation fears.

EUR/GBP prints mild gains above the 0.8500 threshold heading into the key European session on Thursday.

In doing so, the cross-currency pair justifies the previous day’s Doji candlestick beyond 100-DMA. However, cautious sentiment ahead of monetary policy decisions from the Bank of England (BOE) and the European Central Bank (ECB) challenges the pair’s latest moves.

That said, 61.8% Fibonacci retracement (Fibo.) of September-November downside, around 0.8552, restricts the EUR/GBP pair’s short-term upside ahead of the 200-DMA level of 0.8558.

In a case where the EUR/GBP rises past 0.8558, tops marked during November and December will test the pair buyers around 0.8600.

Alternatively, a daily closing below 100-DMA level of 0.8483 will witness multiple supports around 0.8465-60 and 23.6% Fibo. level near 0.8445, not to forget the 0.8425-20 area.

Overall, technical details favor EUR/GBP bulls but it all depends upon the central bank actions.

EUR/GBP: Daily chart

Trend: Further upside expected

 

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