EUR/GBP retakes 0.88 handle, back closer to multi-month highs

The British Pound remained heavily offered on possibilities of a hung parliament, lifting the EUR/GBP cross back closer to nearly 5-month high level beyond the 0.8800 handle touched earlier.

The cross witnessed volatile swings through Asian session as investors continue to assess effects on the outlook for Brexit negotiations. The results declared so far suggests that Tories are unlikely to have outright majority and will have to form a coalition government, possibly making it even more difficult to secure a good Brexit deal for the UK.

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With markets still awaiting the final outcome, the GBP price-dynamics would continue to act as an exclusive driver of the pair's movement through today's trading session.

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Meanwhile, today's release of UK manufacturing/industrial production and goods trade balance data is likely to be overshadowed by news/developments surrounding the UK election results. 

Technical levels to watch

From current levels, a follow through momentum beyond 0.8830 level is likely to accelerate the up-move towards yearly tops near mid-0.8800s, above which the cross seems all set to aim towards reclaiming the 0.8900 handle.

On the downside, corrective swing lows near 0.8745-35 region now seems to protect immediate downside, which if broken could drag the cross back towards the 0.8700 handle en-route 0.8660-55 important horizontal support.