With the ECB planning to launch a potentially €500 billion bond buying program in a year the Bank of England may raise rates and reduce it stimulus the EURGBP could plunge.
While the Euro managed to rally after the rumors were reported once both central bank diverge on stimulus the EURGBP will feel a much greater impact in my opinion. I am looking to short the rallies.
I am short-term bullish on it and have been buying the dips below 0.7800 including this morning’s dip during the early trading session in Europe when it traded just below 0.7730. I think we could see a short covering rally in this currency pair, but would be very careful as a long would go against the trend here and carried additional risks.