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EUR/GBP Signal - MPC Member Hogg Speech - 06 Mar 2017

Signal details
Entry Price: 
0.8630
Close Price: 
0.8649
Direction: 
Low
Expiry Time: 
21:00 GMT
Result: 
OTM
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Sentiment in the British pound has been deteriorating since the past week or two after reports emerged about Scotland wanting to hold its second independence referendum. Economic data was also not supportive of the British pound which last week showed manufacturing, construction and services PMI numbers slowing down. As a result, EURGBP posted strong gains last week erasing nearly half of the losses from the previous weeks.

On the economic front today, new MPC member Hoggs is expected to speak today. Last week, the new MPC member briefly spoke to the UK’s Treasury Select Committee where she was very dovish in her speech. Ms. Hoggs told UK lawmakers that unlike most of other MPC members, she does not expect interest rates to rise anytime soon, signaling that QE was more or less likely to remain in place for longer than expected.

From the technical charts, EURGBP is seen struggling to breakout above 0.8640 resistance level. EURGBP made an attempt to breakout from this level in late January this year but failed to do so, which sent EURGBP falling to a 2-month low. If we get to see another failure at this resistance, EURGBP could continue its declines in the near term.

On the intraday charts, EURGBP is already seen making multiple attempts near 0.8640 but prices was strongly rejected so far near this major resistance level. Therefore, we can expect to see near term declines in EURGBP as the MPC member Hoggs is slated to speak.

It is recommended to purchase daily PUT options near 0.8630 for a 21:00 GMT expiry time as EURGBP could be looking to push lower towards the end of the day.

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.