EUR/GBP pops to 0.8470 after ECB decision

The EUR/GBP cross extended its recovery trend and jumped to 5-day high near 0.8470 region after ECB decided to leave its monetary policy unchanged.

The ECB maintained status-quo and left its main refinancing rate, deposit rate and marginal lending rates at 0.0%, -0.40% and 0.25% respectively. Meanwhile, the central bank also expects the QE program to run through March 2017 and beyond if necessary. 

Immediately after the announcement, the shared currency witnessed a minor bullish spike across the board. Further up-move, however, was restricted as markets await for subsequent presser, where ECB President Mario Draghi's comments will be scrutinized in order to determine the next leg of move for the shared currency.

Technical outlook

Gregor Horvat, Chief Technical Strategist at EW-Forecast, notes, "EURGBP is breaking above the upper channel resistance line which gives an idea that five wave decline from 0.8725 is finished. If that's correct then new three wave rally is now underway. We see price in wave A) of a temporary corrective rally headed back to 0.8485-0.8565 area, where pair may turn south again."