EUR/GBP continues to find some support near 0.90 handle

The post-UK data GBP recovery extended through the mid-European session, now dragging the EUR/GBP cross back closer to the key 0.90 psychological mark.

It was a mixed bag of economic releases from the UK, with manufacturing production holding flat on a monthly basis while industrial production recording a stronger than expected growth of 0.5% during the reported period. Separately, the UK goods trade balance data showed an unexpected rise in deficit to £12.72 billion, up from £11.31 billion previously and £11.0 billion expected. 

In absence of any negative surprise from the manufacturing data, today's data seems to have prompted traders to lighten their bearish GBP bets and has been one of the key factor weighing on the EUR/GBP cross. 

Meanwhile, an offered tone around the EUR/USD major, primarily led by a goodish US Dollar recovery, further collaborated towards an extension of the pair’s pull-back from the vicinity of the 0.9100 handle, fresh yearly tops touched earlier this week. 

From a technical perspective, the cross has managed to hold its neck above the 0.90 handle. Hence, it would be prudent to wait for a decisive break below the mentioned handle before confirming that the cross might have topped out in the near-term. 

Technical levels to watch

Weakness below the 0.90 mark, the cross is likely to accelerate the fall towards 0.8975-70 horizontal support before eventually dropping to its next support near the 0.8940-35 region. On the upside, 0.9045-50 zone now seems to have emerged as immediate resistance, above which the cross is likely to make a fresh attempt towards conquering the 0.9100 handle.