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  • EUR/GBP takes a U-turn from 0.8570 ahead of European open on Thursday.
  • The EUR benefits from the USD’s pullback whereas Brexit doubts drag the GBP down.
  • Traders may now focus on ECB for fresh impulse.

EUR/GBP is on bid around 0.8570 during early Thursday. The quote recently witnessed pullback moves from 0.8570-75 region as traders weigh on Brexit headlines ahead of the European central bank (ECB) monetary policy. Additionally, the revised figure of Q4 2018 Eurozone GDP can also offer intermediate trade opportunities.

While expectations concerning delayed Brexit have helped the British Pound (GBP) off-late, recent news reports seem to dim the prospect and are weighing on the GBP against the EUR. The latest report from Bloomberg conveyed lesser chances of a soft Brexit based on EU leaders’ expectations and that of The BBC reflecting no immediate decision from the British and European leaders when they met in Brussels.

The Euro (EUR), on the other hand, is likely taking advantage of the US Dollar (USD) pullback ahead of the ECB meeting. With the USD witnessing profit-booking on anticipation of soft employment report on Friday, traders rush to EUR and JPY as doubts over Brexit and the commodity front challenge rest of the major currencies.

The ECB is largely expected to announce no change in its present monetary policy at 12:45 GMT. Though, a slew of disappointing data from Eurozone and Germany, coupled with hanging Brexit, may push the central bank President Mario Draghi to extend the central bank’s asset purchase (TLTRO) or portray a bit cautious forward guidance.

Before ECB, final readings of fourth quarter Eurozone gross domestic product (GDP) are also up for release at 10:00 GMT. Both the versions, namely YoY and QoQ, are likely to confirm initial estimates of 1.2% and 0.2% growth for the Q4 2018.

EUR/GBP Technical Analysis

The EUR/GBP needs to slide under 0.8570 to revisit February lows near 0.8530 and then aim for 0.8500 during further downside.

Alternatively, immediate descending trend-line resistance at 0.8610 may challenge buyers, a break of which can offer 0.8620 and 0.8650.