EUR/GBP struggles for direction around 0.8800

EUR/GBP exchanges gains with losses near the 0.8800 mark.
Dollar-selling sustains the upside in both euro and sterling.
Markets’ attention remains on the Eurogroup meetings later today.

Pablo Piovano FXStreet

The better tone in both the shared currency and the quid is prompting EUR/GBP to gyrate around the 0.8800 neighbourhood without a clear direction for the time being.

EUR/GBP looks to COVID-19, BoJo, Eurogroup

EUR/GBP seems to have met some decent support in the mid-0.8700s so far, area coincident with the always-critical 200-day SMA, coming under moderate downside pressure after hitting fresh yearly tops beyond 0.94 the figure in mid-March.

In fact, the recent and strong recovery of the British pound put the cross under heavy pressure, exacerbated at the same time by the offered bias surrounding the European currency on the back of dollar-buying.

In the meantime, investors continue to follow the news surrounding PM Boris Johnson after he was diagnosed with coronavirus and later hospitalized in ICU.

Later in the day, the Eurogroup meeting has gained unusual attention, as officials are expected to debate some form of joint debt issuance in order to counteract the impact of the COVID-19 on the region, particularly in Spain and Italy.

EUR/GBP key levels

The cross is gaining 0.13% at 0.8829 and faces the next resistance at 0.8997 (21-day SMA) seconded by 0.9324 (2019 high Aug.12) and finally .9499 (2020 high Mar.19). On the flip side, a drop below 0.8751 (200-day SMA) would expose 0.8670 (55-day SMA) and then 0.8596 (100-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.

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