EUR/GBP consolidates strong gains post-BoE and holds above 0.8800

• Pound consolidates losses across the board after BoE meeting.
• EUR/GBP ends 3-day slide with a strong rebound.

The EUR/GBP pair soared after the release of the Bank of England decision and remains near daily highs after Mark Carney press conference. The pair climbed from 0.8740 and peaked at 0.8836, reaching the highest level since Monday.

The euro pulled back, falling momentarily below 0.8800 but recently bounced back above at it was trading at 0.8820, more than 80 pips above the level it had before the BoE decision.

The central bank kept rates unchanged as expected on a 7-2 vote, like the previous meeting. The pound weakened amid lower inflation forecasts. Carney left the door open to rate hikes but market odds of a rate hike in August dropped.

Technical levels

EUR/GBP rose back above 0.8800, rebounding from the 20-day moving average that stands at 0.8750. It the pair continues to rise it could test May’s highs around 0.8840 a break higher could clear the way to more gains with a potential target at 0.8865/70.

If the euro fails to hold above 0.8800, support levels might be located at 0.8785, followed by 0.8760 and 0.8725/30 (May low).