EUR/GBP climbs further beyond mid-0.8900s, fresh session tops
|- EUR/GBP regained positive traction on Thursday and snapped two days of losing streak.
- Renewed fears of a no-deal Brexit undermined the British pound and remained supportive.
- Offered tone surrounding the common currency might cap any runaway rally for the cross.
The EUR/GBP cross maintained its bid tone through the early European session and climbed further beyond mid-0.8900s or fresh daily tops in the last hour.
The cross managed to attract some dip-buying on Thursday and for now, seems to have stalled its recent rejection slide from the key 0.9000 psychological mark. The uptick assisted the EUR/GBP cross to reverse the previous day's losses to weekly lows, around the 0.8915 region and snap two consecutive days of losing streak.
Reports that the European Union (EU) leaders will demand the European Commission to publish no-deal plans tempered expectations that Britain and the EU could reach a Brexit divorce agreement by the beginning of next week. This, in turn, took its toll on the British pound and assisted the EUR/GBP cross to gain some positive traction.
On the other hand, the shared currency was being pressured by a modest US dollar short-covering move. This, along with expectations for additional monetary easing by the European Central Bank (ECB), further undermined the euro. This, in turn, should keep a lid on any runaway rally for the EUR/GBP cross, at least for now.
Investors might also refrain from placing any aggressive directional bets, rather prefer to remain on the sidelines and wait for fresh Brexit updates. EU negotiators are reportedly due to update envoys of the bloc's 27 member states on the latest in trade talks with Britain on Friday, which further warrants some caution for traders.
In the absence of any major market-moving economic releases, either from the UK or the Eurozone, the EUR/GBP cross remains at the mercy of the incoming Brexit-related headlines. Any subsequent move up is more likely to confront a stiff resistance near the 0.9000 mark, which if cleared should be seen as a fresh trigger for bullish traders.
Technical levels to watch
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