EUR/GBP: closing on the 0.89 handle
|Currently, EUR/GBP is trading at 0.8900, up 0.03% on the day, having posted a daily high at 0.8925 and low at 0.8856.
EUR/GBP was moving in big pips once again at the start of the week on Monday, rallying from 0.8856 the low to 0.8922 the high. EUR/GBP climbed up to test the region of congestion ahead of the 0.8930 high posted on the 13th October. The cross was breaking through the 4hr-50 SMA at 0.8897, supported by the 0.8880 support area (4hr 21-SMA) 0.8884 on an early dip in NY's morning where the high was made at 0.8922 towards the close before settling a pip or so into the 0.89 handle.
Fundamentally, Brexit nerves continue to be passed on from desk to desk and cable came a cropper after rumours that Brexit talks were stalling on trade, with the process at risk of collapsing without the EU's concession on the current demands while PM May doesn't seem to show any signs of budging on the EUR20b offer vs the EUR60 b the Brussels was looking for - eyes on the EU summit this week.
Meanwhile, on Tuesday, markets will be turning to the retail price index, as well as PPI, and the CPI data. The consumer inflation is expected to advance to 3% on a yearly basis where much of the focus will be in respect to the speculation that the BoE will be in a position to hike interest rates as soon as next month.
EUR/GBP levels
On a break of the 0.89 handle and a look in at the 0.90 handle, as analysts at Commerzbank mentioned, the cloud at 0.9025 and the 50% retracement at 0.9027 are next stops. On the way down, below 0.8880 and 0.8780, the next major band of support extends from the 14th July low at 0.8748 to 0.8720 being the 2015-2017 uptrend and where the 200-day ma and where the 55-week MA is also located.
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