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  • EUR/GBP attracted some dip-buying near the 0.9070 region and refreshed session tops.
  • Dovish comments by BoE Governor Bailey weighed on the pound and remained supportive.
  • A subdued action around the shared currency kept a lid on any meaningful positive move.

The EUR/GBP cross rallied over 50 pips during the mid-European session and refreshed daily tops, around the 0.9122 region, albeit lacked follow-through.

The cross quickly reversed an intraday dip to the 0.9070 region and turned positive for the fourth consecutive session on Thursday. The British pound witnessed some selling after the Bank of England Governor, Andrew Bailey reiterated that the central bank remains ready to take more action if needed.

The remarks fueled speculations about the BoE pursuing negative interest rates. Against the backdrop of Brexit-related uncertainties, Bailey’s dovish sounding comments took its toll on the sterling and turned out to be one of the key factors that assisted the EUR/GBP cross to attract some dip-buying.

On the other hand, the shared currency witnessed a subdued trading action and remained confined in a range amid speculations of additional ECB easing. This was evident from the latest ECB meeting minutes, which revealed that rate cuts and changes to TLTRO conditions are also part of the toolkit.

This, in turn, kept a lid on any strong gains for the EUR/GBP cross. From a technical perspective, the overnight move beyond a one-month-old descending trend-channel resistance and the emergence of some dip-buying on Thursday favours bullish traders and supports prospects for additional gains.

Technical levels to watch