• The Euro holds above 0.8800 against the Pound with bulls capped below 0.8820.
• Moderate UK inflationary pressures are weighing on the Pound.
• Technically, the EUR/GBP maintains its broader bullish trend while above 0.8800.

The Euro shows moderate gains at levels near 0.8820 on Wednesday, favoured by broad-based GBP weakness following softer UK inflation data. The pair, however, remains wavering within previous ranges, with the long wicks in the daily chart's candles, highlighting a hesitant market.

UK Consumer Prices Index (CPI) data confirmed that inflationary pressure moderated to a 3.6% yearly rate in October, from September’s 3.8% while the core inflation eased to 3.4% from 3.5% in the previous month. The final data met market expectations and feeds hopes that the BoE might cut interest rates further at its December meeting, which is weighing on the pound.

Technical Analysis: The broader trend remains moderately positive

The pair’s technical picture is mixed, with price action moving back and forth between 0.8800 and the 0.8820-0.8830 area. The 4-hour RSI is flat around the 50 level, showing a lack of clear bias, although the broader trend remains moderately positive.

Bears would need to break below the trendline support, now around the mentioned 0.8800 area and the November 17 low, near 0.8790, to confirm a trend shift and increase pressure towards the November 3 low, at 08765 area, and the October 27 lows at 0.8720.

Upside attempts remain capped below the November 17 high of 0.8830, which closes the path towards the 0.8865 area, where the November 14 high crosses the top of the ascending channel. Further up, the 161.8% Fibonacci extension of the late October rally lies right above the 0.8900 round level.