Technical analysts at Lloyds Bank reckon the British Pound’s positive start to the new week against the Euro is likely to be short-lived as the exchange rate is in the middle of a longer-term range which makes for choppy conditions.

For those watching the exchange rate from a GBP into EUR perspective, this gives us a bounce to resistance at 1.1217-1.1261 where analysts suspect the rally might run out of impetus and revert back to the more dominant downtrend.

Lloyds Bank's technical analyst Robin Wilkin reckons the Pound’s fall from September highs at 1.1438 should ultimately “extend towards more important” support in the 1.1050-1.10 region.

But should Sterling’s rebound extend - driven by easing domestic political tensions - leading GBP/EUR to break above 1.1260, then Wilkin is inclined to believe a range is developing between 1.1438 and 1.11.

Analyst Lucy Lillicrap at currency brokers in AFEX in London notes how the September recovery failed to establish prices back above 1.1450 (prior notable reactive peak), "thereby effectively preserving the broader descending sequence."

What is clear to us, is that there is little clarity on the near-term outlook from this pair.

The Pound and Euro are fighting it out in a medium-term, multi-week range which lies between 1.2121 and 1.0621.

Indeed, because the exchange rate is more or less in the middle of the range, Wilkin reckons “very choppy” price action is likely near-term so readers should perhaps look at price action as being stuck in a broader side-ways drift.

"Fresh dips are nonetheless still seen as part of an interim range only at present," says Lillicrap.

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