EUR/GBP tumbles to lows near 0.8540

The firm note around the Sterling is dragging EUR/GBP to test daily lows in the 0.8550/40 band on Wednesday.

EUR/GBP gains capped near 0.8630

The European cross is giving away part of the recent upside to highs in the 0.8630 region (January 31), retreating for the first time after three consecutive sessions with gains.

The rising buying interest around the British Pound has prompted the cross to surrender some gains and deflate to the area of 2-day lows near 0.8530 in spite of the solid performance from the single currency.

Data wise today, UK’s Manufacturing PMI matched expectations in January while same gauges in Euroland came in on a mixed note. Next risk event facing the cross will be tomorrow’s BoE MPC meeting and the Quarterly Inflation Report, all ahead of Friday’s US Non-farm Payrolls.

EUR/GBP key levels

The cross is now losing 0.42% at 0.8546 and a breach of 0.8527 (55-day sma) would expose 0.8485 (low Jan.30) and finally 0.8464 (low Jan.27). On the upside, the initial resistance is located at 0.8618 (20-day sma) ahead of 0.8636 (high Jan.31) and then 0.8655 (100-day sma).