EUR/GBP fails ahead of 0.90 handle, corrects after hitting fresh yearly tops

The EUR/GBP cross built on previous session's strong gains and refreshed yearly tops, albeit failed to move beyond the key 0.90 psychological mark.

The cross surrendered all of its early up-move and has now drifted mildly into negative territory, currently trading at session lows around 0.8965-60 region. 

With the EUR/USD major entering a bullish consolidation phase, following yesterday's sharp upsurge to nearly two-year tops, a goodish recovery witnessed around the GBP/USD major has been the sole driver of the pair's sharp downtick of around 30-pips during the early European session.

   •  ECB: A cautious Draghi fails to the contain the EUR - ING

Thursday's not so dovish comments by the ECB President Mario Draghi now seems to have fueled expectations that the ECB's bond purchase program could end possibly by the third quarter of next year. This coupled with the growing consensus that the BOE won't raise rates anytime soon would be sufficient enough to categorize today's pull-back as corrective in nature.

   •  EUR futures: rally shows no exhaustion

Technical levels to watch

Immediate support is pegged near 0.8935-30 zone, below which the cross could extend the corrective slide even below the 0.8900 handle towards its next support near 0.8865 level. On the upside, the 0.9000 handle now seems to have emerged as an immediate strong hurdle, which if conquered should accelerate the up-move towards 0.9030 intermediate resistance en-route 0.9060-65 resistance.