EURGBP recently busted through the ceiling at the .8400 major psychological mark then climbed to a high of .8480 before retreating. The pair could find more buyers at the area of interest marked by the Fib levels.

The 38.2% level is close to the broken resistance while the 50% level is at .8380. A larger pullback could reach the 61.8% Fib near the .8350 minor psychological mark and the moving averages.

The 100 SMA is below the 200 SMA for now, but the gap between the indicators has narrowed enough to reflect weakening bearish pressure and a likely bullish crossover. Stochastic has a bit of room to head south before indicating oversold conditions, so the correction could keep going until it does.

RSI has more room to move lower, so price could follow suit until oversold conditions are met. A break below the swing low near .8300, on the other hand, could signal a continuation of the longer-term slide.

There are no major reports due from both the UK and the eurozone for the rest of the week, although there might still be some catalysts for big moves. BOE head Bailey has a speech coming up and might have some remarks on the central bank’s tightening timeline.

Meanwhile, the euro remains strongly supported after the ECB indicated a surprise shift to a more hawkish stance in last week’s statement. Many expected the central bank to sit on its hands, but Lagarde signaled scope for tightening if inflation overshoots their target.

Later in the week, the UK will release its preliminary GDP reading for the last quarter of 2021. Analysts are expecting to see another 1.1% growth figure, although a weaker than expected read might spur stagflation concerns and drag the pound further south. Industrial production data are worth keeping tabs on as well, with a meager 0.1% uptick eyed.