EUR/GBP Surpass 0.7700 Handle with Ease, Now Eyeing 0.7750 Level

EUR/GBP Surpass 0.7700 Handle with Ease, Now Eyeing 0.7750 Level

1 June 2016, 12:15
Roberto Jacobs
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EUR/GBP Surpass 0.7700 Handle with Ease, Now Eyeing 0.7750 Level

As the EU referendum vote gets closer, an unexpected fall in the British Pound assisted the EUR/GBP cross to extend its sharp recovery for second day running.

The pair on Tuesday recovered sharply after dropping earlier to nearly retest 3-month lows support near 0.7570 area on uncertainty surrounding the upcoming 'Brexit' vote on June 23. 

The British Pound failed to get any respite from today's slightly better-than-expected UK manufacturing PMI and the EUR/GBP cross extended its recovery momentum to easily surpass 0.7700 handle.

The pair is currently trading at its highest level in six days, near 0.7716, erasing majority of its losses recorded in the previous week and has moved within striking distance of testing a two-week high level of 0.7754. 

Technical levels to watch

From current levels bulls would be aiming to conquer 0.7750-55 resistance area, above which the pair seems to extend its upward trajectory towards an important support confluence break-point, turned resistance, around 100-day SMA near 0.7795-0.7800 region.

Meanwhile on the downside, weakness back below 0.7700 handle seems to drag the pair immediately towards 0.7665-60 horizontal support, which if broken might negate the bullish bias and turn the pair vulnerable to resume its near-term depreciating move towards retesting sub-0.7600 support area.


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