EURGBP is in the middle of a correction to its ascending trend line on the 4-hour time frame, and support might hold as it lines up with other support levels.

The 61.8% Fibonacci retracement level is close to the trend line around the .8850 minor psychological mark and the dynamic support at the moving averages. A shallow correction could already find buyers at the 50% Fib, possibly sending EURGBP back up to the swing high near .9000 again.

Moving averages are oscillating, though, as the 100 SMA appears to be crossing below the 200 SMA. RSI has some room to head south before reaching the oversold region, so selling pressure could stay in play for a while.

Still, stochastic is turning higher from the oversold region to reflect a return in bullish pressure. The oscillator has plenty of room to climb before reaching the overbought area, so EURGBP could follow suit.

EURGBP could take cues from the BOE’s monetary policy hearings lined up today, as well as the UK GDP report due on Friday.

Keep in mind that the UK economy is struggling with low growth amid high inflation, so traders are keen to find out what the central bank’s next moves might be. Analysts are expecting to see a flat reading for the Q4 2022 GDP, but a negative figure would confirm that the economy is officially in recession.

Other underlying indicators such as the construction output and industrial production figures might also impact pound price action.

Meanwhile, the EU economic forecasts are also up for release today and could mean upside for the shared currency if upgrades are made. PMI readings from the region have shown significant improvements in the past months, possibly leading to a more optimistic outlook for the economy.