EUR / GBP clings to modest gains around 0.8550

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  • A combination of factors helped EUR / GBP regain some positive momentum on Friday.
  • COVID-19 nervousness weighed on the British pound, a moderate demand in dollars benefited the euro.

The EUR / GBP cross rallied around 30 pips from the daily lows and reached the upper end of its daily trading range, around the 0.8555 region in the last hour. After sharp sideways rallies on Thursday, the cross saw some selling during the first half of the European session. The decline found support at the 0.8525 region.

Concerns about a new COVID-19 outbreak in the UK turned out to be one of the key factors behind the sterling’s relative underperformance against its European counterpart. This overshadowed comments by Saunders of the Bank of England, which pointed to the possible need for a tightening of monetary policy.

For hours the EUR / GBP has remained stable around 0.8550, in neutral ground for the week and far from the 0.8500 floor, which it reached days ago. The bias and the short-term trend remains bearish. The bounce provides some air to the euro. A weekly close above 0.8610 could leave the euro stronger.

Technical levels

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