EUR / GBP rises to new weekly highs around 0.8925-30 region

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  • EUR / GBP gains continuation traction for the second day in a row on Wednesday.
  • Not-so-optimistic Brexit news weighs heavily on the British pound and continues to support the pair’s upward move.

The crossing EUR/GBP has reversed an initial drop below the 0.8900 level and has soared to new weekly highs, around the 0.8925-30 region, during the European session on Wednesday.

The crossing has gained some positive traction for the second day in a row on Wednesday and has built on this week’s modest recovery from near the monthly low support around the 0.8865-60 region. Sterling’s underperformance relative to its European counterpart could be attributed to the anxiety around Brexit amid lack of progress on key friction points.

Meanwhile, the sudden spike over the past hour has occurred after the president of the European Commission, Ursula von der Leyen, has warned that a Brexit deal is still far from secure. Von der Leyen has said that disagreement over access to Britain’s fishing waters continues to block progress, which in turn has been seen as a key factor weighing on the British pound.

On the other hand, the prevailing selling bias around the US dollar has offered some support to the common currency. This is also another factor driving the EUR / GBP cross higher during the first half of Wednesday’s trading action amid the absence of relevant economic releases from either the Eurozone or the UK.

Therefore, incoming Brexit-related news will continue to play a key role in influencing sterling price dynamics and generating some significant trading opportunities around the EUR / GBP cross. With that said, it remains to be seen whether the cross can capitalize on the attempted recovery move or meet new selling at higher levels.

EUR / GBP technical levels

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