The EUR/GBP cross reversed majority of its early gains closer to the 0.8700 handle, albeit has managed to hold mildly in positive territory through early European session.
Currently trading around 0.8670 region, the cross gained some traction at the start of a new week in wake of growing speculations that the ECB might consider raising interest-rates by the end of this year. Adding to this, the outcome of Dutch elections further supported the bid tone surrounding the shared currency.
However, last week's hawkish BoE twist now seems to underpin demand for the British Pound. This coupled with easing Brexit worries, after Queen Elizabeth formally approved the Brexit legislation and gave UK Prime Minister Theresa May the power to begin EU exit talks, further supported the British Pound and collaborated towards capping the cross just below the 0.8700 handle.
Amid absent relevant fundamental drivers, in-terms of any major market moving economic releases, market participants now look forward to a speech from the BoE MPC member Andy Haldane, due scheduled later during the NY session, for fresh impetus.
EUR/GBP signals further rangebound medium term – Danske Bank
Technical levels to watch
Bears would be eyeing for weakness below 0.8660 level, which if broken is likely to accelerate the pair's corrective slide towards 0.8585 support area, with some intermediate support near 0.8630-20 area.
On the upside, 0.8695-0.8700 region now seems to have emerged as immediate resistance, which if cleared seems to trigger a short-covering bounce towards 0.8730 resistance before the cross eventually aims towards retesting nearly two-month highs resistance near 0.8770-80 region.
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