EUR/GBP bounces-off weekly low, still below 0.8400 ahead of BOE

The British Pound seems to trim some of its gains, helping to the EUR/GBP cross bounce-off weekly lows to currently trade around 0.8375-80 region ahead of the much awaited BOE monetary policy decision.

During the course of current trading week, sterling has gained a bit of traction despite of PMI reading showing a sharp contraction in activity across various sectors of the UK economy and prospects of monetary easing by the Bank of England. 

Later during the day, BOE will announce its monetary policy decision with markets already pricing-in a 25bps rate-cut. However, heading into the big event risk, traders seem to turn cautious and reposition themselves as any surprise announcement would trigger a knee-jerk reaction across GBP pairs.

Meanwhile, in absence of any economic releases from the Euro-zone the cross would be solely driven by action surrounding the British Pound. 

Technical levels to watch

From current levels, 0.8400 round figure mark seems to act as immediate resistance, above which the pair seems to extend its upward trajectory towards 0.8470 level ahead of 0.8500 psychological mark resistance. 

On the flip side, sustained weakness below weekly lows support near 0.8350 region now is likely to drag the pair through 0.8300 handle, towards testing July swing lows support near 0.8250 area.