EUR / GBP flirts with daily lows around the 0.8925 region

• EUR / GBP is witnessing some new selling on Friday and returns the positive movement of the previous day.
• The not-so-positive developments around Brexit raise hopes for an extension of the transition period.
• The pessimistic expectations of the ECB weighed on the euro and further contributed to the selling bias.

The crossing EUR/GBP has seen some selling during the first half of the European session on Friday and has fallen to new daily lows, around the region of 0.8925 in the last hour.

After an initial rally to the 0.8960 region, the cross has encountered new sales on the last trading day of the week and has returned a significant part of the positive movement of the previous day. The British pound has been supported by hopes of an extension of the Brexit transition period and has received an additional boost following the release of UK retail sales figures. stronger than expected.

It’s worth remembering that Brexit talks were suspended on Thursday after a member of the EU team tested positive for COVID-19. That said, the EU negotiating team has informed envoys from all 27 member states that the Brexit talks remain unresolved on three main issues: level playing field, fishing rules and state aidAlthough the news has done little to boost a sell around the British pound.

On the other hand, the common currency remains relatively on the defensive for expectations that the European Central Bank will announce additional monetary stimulus in December. This, in turn, has contributed to the intraday decline of the EUR / GBP pair, marking the third day of negative movement of the last five.

Now it will be interesting to see if the EUR / GBP cross can find some support at lower levels or break the round 0.8900 level, setting the stage for a further bearish move in the short term. Meanwhile, Brexit-related news will continue to play a key role in influencing the short-term momentum of the pair.