EUR/GBP recovers to 0.7600 handle ahead of EU CPI

After an initial downward spike to 0.7572 on the back of latest 'Brexit' poll results, the EUR/GBP pair has managed to stage a minor recovery and turn flat to currently trade just above 0.7600 handle.

On Tuesday, the British Pound bulls got a boost from the latest ORB poll for the EU referendum vote on June 23 that revealed a lead for respondents favoring to remain in the EU. According to the poll results, support for the UK to stay in EU reached 51% while leave count reached 46%. 

Immediately after the release the EUR/GBP cross dropped to 0.7572 before recovering back above 0.7600 handle as the GBP/USD major confronted fresh supply above 1.4700 handle. Traders now await for release of the flash version of Euro-zone CPI for the month of May, which would be the key headline number to be watched during the European session.

Technical levels to watch

On a sustained trade above 0.7600 handle, the pair could possibly extend its recovery towards 0.7635-40 horizontal resistance, which is closely followed by resistance near 0.7665-70 zone. A clear break through 0.7665-70 resistance now seems to assist the pair to surpass 0.7700 handle resistance and head towards testing its next major resistance near 0.7745-50 region.

Alternatively, reversal from current levels and a subsequent break below 0.7570-65 recent lows support seems to drag the pair immediately towards 200-day SMA support, currently near 0.7525 region. A convincing break below the very important 200-day SMA region would pave way for extension of the pair's downward trajectory in the near-term.