EURGBP is trending lower on its 1-hour chart, with the falling highs connected by a descending trend line that’s been holding since the middle of the month. The Fibonacci extension tool shows where sellers might be aiming if the selloff carries on.

The 38.2% level is at .8573 then the 50% level is at .8560. The swing low lines up with the 61.8% Fib at .8544 then the 76.4% level is at .8526. The full extension lines up with the .8500 major psychological mark.

The 100 SMA is below the 200 SMA to indicate that the path of least resistance is to the downside or that resistance is more likely to hold than to break. The 100 SMA dynamic inflection point is near the trend line to add another upside barrier around .8620 in case price busts higher.

Stochastic is heading lower to show that sellers have the upper hand, and the oscillator has some room to go before reaching the oversold region to reflect exhaustion. RSI is treading sideways to signal consolidation, though.

Sterling sold off against most of its peers after the BOE Monetary Policy Report hearings since policymakers brushed off any major threats from high inflation. This suggests that they won’t be tightening monetary policy anytime soon and would likely maintain asset purchases and low interest rates.

Meanwhile, the euro was able to get a bit of relief from somewhat upbeat data, as the German final GDP came in at 0.3% versus the initially reported 0.1% uptick. The German GfK consumer climate report is coming up next and an improvement from -15.6 to -14.0 is eyed, signaling slightly weaker pessimism.

There are no major reports due from the UK economy, but sterling has been able to take advantage of the progress in the country’s vaccine rollout so far. Continued developments in this aspect could continue to support the pound against the euro.