EUR/GBP drops to lows near 0.8540

The bid tone around the British pound is now dragging EUR/GBP to test fresh lows on the 0.8540/35 band.

EUR/GBP weaker ahead of Payrolls

The selling pressure remains intact around the greenback, helping the risk-associated assets to recover some ground after the recent drop and prompting the European cross to post its second consecutive pullback.

In the data space, UK’s trade deficit has come in below estimates during May, while German trade balance figures showed the trade surplus shrunk to €22.2 billion during the same period, all ahead of US Non-farm Payrolls, seen at 175K for the month of June.

EUR/GBP key levels

The cross is now losing 0.35% at 0.8538 and a breakdown of 0.8508 (low Jul.6) would allow a test of 0.8383 (high Jun.27) and then 0.8131 (20-day sma). On the flip side, the initial hurdle is located at 0.8628 (2016 high Jul.6) ahead of 0.8651 (high Aug.28 2013) and then 0.8712 (high Jul.17 2013).