EUR/GBP falls to three-day lows under 0.8600

• Pound among top performers on Thursday gains also versus US dollar.  
• EUR/GBP corrects lower after rising during four consecutive days.  

The EUR/GBP is falling on Thursday, correcting lower from weekly highs it reached con Tuesday at 0.8645. Recently it bottomed at 0.8589, the lowest in three days. As of writing, it is hovering around 0.8600, where the 20-day moving average stands.  

The euro is ending a four-day streak of gains versus the pound. With EUR/USD trading at monthly lows below 1.1800, the euro could weaken further. At the same time, GBP/USD is still in positive territory for the day.  

The deterioration in market sentiment is not affecting the pound that is among the top performers on Thursday. A conciliatory tone between the United Kingdom and the European Union on vaccine distribution appears to be helping the currency. European Union leaders are meeting to discuss the vaccination, not only about exports but also on speeding up the process.  

From a technical perspective, the EUR/GBP remains in a medium-term bearish trend. In the short-term, it was correcting higher. The move to the upside lost momentum after approaching 0.8650 and after being unable to hold above 0.8630. If the euro recovers levels on above 0.8630, it could strengthen further. On the flip side, a consolidation under would suggest a potential end of the correction, favoring a consolidation between 0.8630 and 0.8575. The downside’s critical support is seen at 0.8545/50 (March 9, 10, and 11 low).

Technical levels