- EUR/GBP drops and tests daily lows near 0.8960.
- Boris Johnson became the new UK PM.
- Sterling sheds some ground following the vote.
After bottoming out in the 0.8960 region, EUR/GBP now managed to regain some composure and continues to pare losses in the wake of the Conservative final vote.
EUR/GBP remains under pressure
The European cross remains on the defensive, trimming the earlier spike to levels beyond 0.90 the figure after Boris Johnson became the new UK Prime Minister.
The British Pound remains unfazed following the results, as consensus has largely anticipated the final vote.
However, investors’ are likely to remain focused on the UK political arena for the time being in light of potential resignation of more ministers, which should put GBP under extra pressure.
EUR/GBP key levels
The cross is receding 0.16% at 0.8969 and a breach of 0.8954 (low Jul.22) would open the door to 0.8919 (low Jul.2) and then 0.8872 (low Jun.20). On the upside, the next hurdle aligns at 0.9051 (monthly high Jul.17) seconded by 0.9062 (high Jan.11) and finally 0.9092 (2019 high Jan.3).