According to Strategist Vladimir Miklashevsky at Danske Bank, occasional upticks in the European cross should be viewed as selling opportunities.
Key Quotes
“EUR/GBP bounced above 0.8880 early this morning on the back of EUR appreciation amid EU’s migration deal. As such we expect GBP to remain sensitive to Brexit comments as the EU summit continues today”.
“However, the UK governments discussions around its white paper is likely to attract more attention when Theresa May’s cabinet most likely meets next week to try to come to an agreement”.
“From a risk/reward perspective, we think the break above 0.8850 in EUR/GBP is a selling opportunity. In the very short term, however, a further clean break above 0.8886 would EUR/GBP the cross into rather unchartered territory which could trigger additional EUR/GBP rally. This e.g. could materialise if GBP/USD breaks below 1.3050 so watch out for this level today”.
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