Search ForexCrunch
  • EUR/GBP witnessed some selling on Thursday and snapped two days of winning streak.
  • Hopes for a last-minute Brexit deal underpinned the pound and exerted some pressure.
  • A modest pullback in the shared currency further contributed to the intraday selling bias.

The EUR/GBP cross edged lower during the early European session and refreshed daily lows, around the 0.9030 region in the last hour.

Following a brief consolidation through the first half of the trading action on Thursday, the cross witnessed some profit-taking and eroded a part of the previous day’s positive move to the highest level since October 27. The EUR/GBP cross snapped two consecutive days of the losing streak, albeit has still managed to hold its neck comfortably above the key 0.9000 psychological mark.

The British pound was back in demand amid renewed hopes for a last-minute Brexit deal, which, in turn, was seen as one of the key factors exerting some pressure on the EUR/GBP cross. In fact, Ireland’s Foreign Minister Simon Coveney said this Thursday that there was a good chance that Britain and the European Union would secure a trade deal in the next few days.

Apart from this, a modest pullback in the shared currency – though lacked any obvious fundamental catalyst – further contributed to the offered tone surrounding the EUR/GBP cross. That said, the downside is more likely to remain cushioned as investors might still refrain from placing aggressive GBP bullish bets, rather prefer to wait for fresh Brexit updates.

It is worth recalling that the EU’s chief Brexit negotiator Michel Barnier on Wednesday said that Brexit talks have reached a make-or-break moment amid a wide gap on fishing rights. This makes it prudent to wait for some strong follow-through selling before traders start positioning for the resumption of the prior well-established bearish trend for the EUR/GBP cross.

Technical levels to watch