- 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
