EUR/GBP pushes higher well above 0.9000

EUR/GBP clinches fresh tops in the 0.9030/35 band.
The selling bias around the pound gives oxygen to the move.
UK Manufacturing PMI surprised to the upside at 57.5 in December.

Pablo Piovano FXStreet

The downbeat note surrounding the quid favours the daily recovery in EUR/GBP beyond the key 0.90 the figure on Monday.

EUR/GBP higher on EUR-strength

The renewed selling pressure around the British pound collaborates with the upside in the cross to 2-day tops in the 0.9030/35 zone, flirting at the same time with the 100-day SMA (0.9034). In the same line, the strong bid tone in the European currency also underpins the daily bounce in EUR/GBP.

In the meantime, GBP remains in centre stage following the last-minute Brexit deal, while investors appear to have shifted their focus to the performance of the UK economy amidst the coronavirus pandemic, the vaccine rollout (vs. the new variant of the virus) and the likeliness that the BoE could move rates below the zero threshold in the next months.

In the UK data sphere, December’s Manufacturing PMI came in better than expected at 57.5 (from 55.6) while Mortgage Approvals also surprised to the upside at 104.97K in November. Further data saw the BoE’s Consumer Credit at -1.539 billion in November and M4 Money Supply expanding at a monthly 0.8% during the same period.

EUR/GBP key levels

The cross is up 0.99% at 0.9032 and faces the next up barrier at 0.9047 (21-day SMA) followed by 0.9229 (monthly high Dec.11) and then 0.9291 (monthly high Sep.11). On the other hand, a breach of 0.8978 (200-day SMA) would expose 0.8942 (weekly low Dec.31) and finally 0.8861 (monthly low Nov.11).

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.

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