EUR/GBP drops to 2019 lows around 0.8470
- EUR/GBP tumbled to 0.8470, the lowest level so far this year.
- GBP-buying dragged the cross lower.
- Odds for a Tory majority win gave extra wings to the sterling.
The rally in the British pound has dragged EUR/GBP to fresh yearly lows in the 0.8470 region.
EUR/GBP focused on elections
The European cross has quickly fully reversed the May-August impressive rally to the area above the 0.9300 handle and it has shifted the focus entirely to the downside after falling to levels last seen in May around 0.8480, where some support also emerged.
In addition, the euro continues to shed ground amidst some recovery in the greenback coupled with alternating headlines from the US-China trade front.
The sterling gained extra momentum today after stop-orders were triggered following the breakout of the 1.30 handle vs. the buck, while latest election poll results keep pointing to a Tory majority win on the December 12 elections.
In the docket, the key Services PMI in the UK came in above estimates at 49.3 for the month of November, while the European gauges also came in on the positive side.
EUR/GBP key levels
The cross is retreating 0.60% at 0.8473 and a breach of 0.8470 (2019 low Dec.4) would expose 0.8382 (monthly low May 2017) and then 0.8297 (2017 low April 18). On the upside, the next barrier aligns at 0.8557 (21-day SMA) seconded by 0.8605 (high Nov.22) and finally 0.8676 (55-day SMA)
Author
Pablo Piovano
FXStreet
Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.
