EUR/GBP: bears lurking and capping the bid ahead of

Currently, EUR/GBP is trading at 0.8542, up 0.37% on the day, having posted a daily high at 0.8553 and low at 0.8505.

EUR/GBP is consolidating the surge from the 20 hourly sma at 0.8522 before reaching aforementioned highs. The euro is taking the lead at the moment while sterling remains one of the most subdued out of the G10's. The euro is attracting a bid as concerns for populist outcomes of the forthcoming Dutch and French elections fade while for today's event, we await Trump's address to Congress.  

Analysts at Westpac explained that a pro-EU/Euro President with a Republican led Assembly is the most likely of outcomes. " However, until that becomes clear, volatility and risk aversion may develop. Rather than push the EU and Euro towards an unravelling, any extreme widening of spreads and EUR sell-offs should provide opportunities to position for more mainstream outcomes (with subsequent narrowing of spreads and rebounds in EUR)."

EUR/GBP levels

EUR/GBP is trading with a negative bias below 0.8590 and analysts at Commerzbank explained that they look for a decline to extend to the 0.8304 Dec 2016 low. "Initial resistance lies at 0.8592 ahead of the resistance line at 0.8627. Only above 0.8635 would allow for another run up to key resistance offered by Fibo resistance and the recent high at 0.8852/53. We assume that 0.8852/53 is a short-term top for the market."