• Brexit uncertainty prompts fresh GBP selling.
• Lacks any follow through momentum on subdued EUR demand.
The EUR/GBP cross caught some strong bids near the 0.8900 handle and quickly recovered over 50-pips from session lows.
In what could be termed as a late reaction to comments by the UK Brexit minister David Davis, saying that France & Germany are blocking progress over the Brexit talks, might have prompted some fresh selling around the British Pound and seems to be the only factors behind the pair's sharp up-move over the past couple of hours.
The recovery move, however, seemed lacking conviction, with the cross quickly reversing around 20-pips from session tops, amid absent fresh fundamental drivers and lack of follow-through buying interest around the shared currency.
Meanwhile, the market had a rather muted reaction to Deutsche Bundesbank President Jens Weidmann's bearish comments that inflationary pressures remaining subdued and highly accommodative monetary policy stance would remain even after the end of QE program.
Technical levels to watch
Momentum beyond the 0.8955-60 region could assist the cross to make a fresh attempt towards conquering the key 0.90 psychological mark and retest 0.9015-20 heavy supply zone.
On the flip side, 0.8920 level now becomes an immediate support to defend, which if broken might now drag the cross below the 0.8900 handle towards its next support near the 0.8875-70 region.
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