EUR/GBP climbs toward 0.8400 as pound extends losses

• Pound hit by risk aversion and Bailey’s comments.
• Euro shows resistance versus strong dollar, up against Swiss franc.
• EUR/GBP heads for highest close since March 17.

The EUR/GBP rose further after the beginning of the American session and hit a fresh weekly high at 0.8396. The euro remains near the top with the positive tone intact.

Pound under pressure as GBP/USD tumbles

The pound was trading lower and it extended losses following comments from Bank of England governor Andrew Bailey. He talk about signs of growth deceleration and warned about the impact of commodity price swings.

More recently, European markets trimmed gains and US stocks opened mixed after being in positive during most of the pre-market session. Investors’ sentiment deterioration weighed on GBP which dropped further.

Also, the decline of GBP/USD below 1.3100 added to the negative tone of the pound across markets, pushing EUR/GBP closer to 0.8400. The next key level could be seen at 0.8415, a daily close clearly above would expose the March high at 0.8465.

The area around the 20-day Simple Moving Average at 0.8350 has become relevant support. A slide below would negate the current positive bias in EUR/GBP. The next support stands at 0.8320 followed by last week’s low at 0.8293.

Technical levels