- Risk aversion hits the British pound.
- Despite the “day of liberation”, the expectations are not the best.
The EUR / GBP extended the bullish run and climbed to 0.8622, reaching the highest level since June 15. The price remains above 0.8600, with the bullish tone in favor, supported by a weakness of the British currency, in a context of fall in the equity markets.
The European stock markets yield on average more than 2.5% and on Wall Street the main ones are close to losses of 2%. The advance of coronavirus cases threatens the global economic recovery and damages expectations at the beginning of the week. This context is detrimental especially for the pound. While EUR / USD has rebounded, erasing losses for the day, GBP / USD is hovering around recent lows near 1.3710.
Bearish bias threatened
From a technical point of view, EUR / GBP is testing a critical level, which is the 0.8620 zone. A break with a close clearly above, would leave the cross without the bearish bias, and enable more advances.
The next resistance is around 0.8645. If there is a pullback from the current levels with a return clearly below 0.8600, they could indicate the continuity of the routes in ranges between 0.85 and 0.86. Technical levels