“¢ The post-BoE GBP upsurge lacks any follow-through and helps regain positive traction.
“¢ Moves higher for the second straight session despite mixed Ifo business climate survey.
Having posted a session low level of 0.8781, the EUR/GBP cross turned higher and set over one-week tops in the last hour.
The cross built on last week’s rebound from 0.8725 area and is now looking to extend the momentum further beyond the 0.800 handle. With investors looking past the latest hawkish BoE MPC vote split, prolonged Brexit uncertainties kept the GBP bulls on the defensive and was seen driving the cross higher.
The latest leg of an uptick since the early European session could further be attributed to a goodish pickup in the demand for the shared currency despite not so impressive German Ifo business climate index, which retreated for the fifth consecutive session.
It, however, remains to be seen if bulls are able to maintain their dominant position or the up-move once again fizzles out near the very important 200-day SMA, all against the backdrop of a dovish ECB outlook.
Technical levels to watch
Immediate resistance is pegged near the 0.8820 region (200-DMA) and is followed by the 0.8840 heavy supply zone, above which the cross might aim towards reclaiming the 0.8900 handle. On the flip side, the 0.8780 level now seems to have emerged as an immediate support, which if broken might turn the cross vulnerable to slide back below mid-0.8700s towards retesting post-BoE swing lows near the 0.8730-25 zone.
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