EUR/GBP pulls back after testing 0.88 handle's offers, seems clear ahead

EUR/GBP is currently making further bullish steps in a monthly bull trend that started back in November 2015. 

EUR/GBP is a long-term bull trend, despite the concerns over a European banking crisis and countries that are debating whether to remain in the EU or not, while Brexit is certainly on the cards now that May has confirmed Article 50 will be triggered before the end of March. There had been some commotion over a Bloomberg article earlier this week suggesting the ECB could taper before the end of the QE programme, but that has been quickly quashed by analysts reminding markets that not only that the ECB said in its September meeting that they maintain the view that its baseline scenario “remains subject to downside risks,” but also the ECB actually lowered its inflation forecast for 2017 from 1.3% to 1.2%. So there is unlikely to be a tapering any time soon, as explained by analysts at Westpac, adding, "The last step the ECB would want to take now would be to formally signal to the financial markets that its easing stance will be reversed."

EUR/GBP levels

EUR/GBP eroded the 0.8724 16th August peak, then the 0.8815 February 2013 peak was taken out and now markets look towards the 0.9250 area as a feasible milestone on the long dated charts (March 2009). In the meantime, with spot trading at 0.8795, we can see next resistance ahead at 0.8798 (Hourly 20 EMA), 0.8803 (YTD High), 0.8803 (Daily Open), 0.8803 (Monthly High) and 0.8803 (Weekly High). Support below can be found at 0.8787 (Weekly Classic R2), 0.8777 (Daily Low), 0.8775 (Daily Classic PP), 0.8736 (Daily Classic S1) and 0.8724 (Weekly Classic R1).