EUR/GBP daily upside loses momentum around 0.8850
- EUR/GBP reverses Tuesday’s pullback and advance to 0.8850.
- UK Court ruled against PM Johnson’s suspension of Parliament.
- Chat of early elections, Corbyn being interim PM hurts the Pound.
The now increasing selling pressure around the Sterling is propping up the advance of EUR/GBP to the mid-0.8800s, where coincides the 10-day SMA.
EUR/GBP focused on UK politics
The European cross managed to leave behind Tuesday’s negative performance and resume the upside today, although always within the broader consolidative theme i the area of 4-month lows.
The bearish sentiment gathered traction around the Sterling today following market chatter that Labour leader J.Corbyn could be interim PM in case PM B.Johnson steps down.
Recently, the UK’s Supreme Court ruled that the decision by PM B.Johnson to suspend Parliament was unlawful, exacerbating the political effervescence in the UK and putting Johnson under extra pressure amidst speculations of resignation and early elections.
On the other side of the Channel, the shared currency remain under pressure on the back of the resumption of the bullish bias in the Greenback, poor PMI prints in Euroland (Monday) and dovish comments from President Draghi before the European Parliament (also on Monday).
Later in the day, PM Boris Johnson is expected to address MPs.
EUR/GBP key levels
The cross is gaining 0.27% at 0.8839 and faces the next up barrier at 0.8906 (50% Fibo of the May-August rally) seconded by 0.8957 (100-day SMA) and then 0.9033 (55-day SMA). On the other hand, a breach of 0.8785 (monthly low Sep.20) would expose 0.8667 (78.6% Fibo of the May-August rally) and finally 0.8488 (monthly low May 6).