EUR / GBP extends fall and approaches 0.9000 before generalized rise of the pound

• The pound appreciates in the market, recovers previous fall.
• Expectation for a Brexit deal boosts the GBP.
• Intense hours and days are coming with Brexit, ECB and the European summit.

EUR / GBP is falling on Wednesday, accelerating the pullback from a month-long high that reached 0.9144 on Monday. The price is at the day’s lows, just above 0.9000, the lowest level since Friday. The expectation of a possible settlement by the Brexi it has driven the pound into the market.

The British currency is one of the best performing on Wednesday, affected by the twists and turns in the negotiations. In hours, Prime Minister Boris Johnson will travel to Brussels to meet with the President of the European Commission, Urusla von der Leyen. It is estimated that this meeting could lead to an agreement or the beginning of preparation for a non-agreement.

Rumors and speculations, along with different statements from officials are the order of the day, with some influencing operators’ expectations more than others.

En with regard to the euro, the common currency remains unchanged. EUR / USD is trading sideways above the 1.2100 zone and close to highs in months, although EUR / CHF is trading around lows in recent months.

The expectation in the Eurozone is about the meeting of the European Central Bank from Thursday. More stimulus measures and new macroeconomic projections are expected. Also that day the European leaders summit, which will deal with Brexit, but also the budget and the Recovery Fund.

From a fundamental point of view, key hours are ahead for both the pound and the euro. On the technical side, EUR / GBP improved the outlook after breaking a bearish line last week at 0.9000, but the advance was unable to hold above 0.9070. A close above 0.9080 would point to more gains ahead, while below 0.8970 (20-day moving average), it will mean weakness ahead.

Technical levels