FxWirePro: EUR/GBP bounces off 55-EMA support, focus on ECB policy decision for further impetus

Chart - Courtesy Trading View 

EUR/GBP was trading 0.47% higher on the day at 0.8800 at around 14:45 GMT.

The pair has bounced off 55-EMA support and has broken above 21-EMA at 0.8788.

Common currency has largely ignored downbeat German GDP data released earlier on Monday, remains buoyed after the data from Spain showed that inflation unexpectedly accelerated in January.

Preliminary data published by Germany's Destatis showed German economy contracted by 0.2% on a quarterly basis in Q4. 

On an annualized rate, the Gross Domestic Product grew 1.1%, down from 1.3% recorded in the third quarter, and missed the market expectation of 1.3%.

Focus remains on the ECB which is predicted to raise its policy rate by half percentage point on Thursday.

Support levels - 0.8787 (21-EMA), 0.8753 (55-EMA)

Resistance levels - 0.8803 (20-DMA), 0.8852 (Jan 25th high)

Summary: EUR/GBP bounces off 55-EMA support, but upside lacks conviction. 20-DMA offers stiff resistance at 0.8802, decisive break above will change near-term dynamics to bullish.