EUR/GBP eyes the 0.90 handle, politics dominate

Currently, EUR/GBP is trading at 0.8970, up 0.30% on the day, having posted a daily high at 0.8991 and low at 0.8939.

EUR/GBP is up modestly while the euro remains firmly better bid and sterling is weighed upon by continued and ever-changing sentiment over Brexit. The euro was supported yesterday with a relief rally after the Catalan regional government appeared to stop short of declaring independence from Spain. 

"The issue remains fraught, however, with Madrid seeking clarification on the Catalan position and starting the process which will impose direct control from the central government on the region. For now, however, investors feel that a period of calm may prevail, allowing the EUR to steady," noted analysts at Scotiabank.

GBP/USD: focus has swung back to Brexit risks - Scotiabank

Meanwhile, PM May failed to impress yet again on a radio show yesterday when she was unable to be definitive over questions of her true support for a Brexit. "Chancellor Hammond told lawmakers that the government had to be prepared for a “bad-tempered” exit from the EU," explained the analysts at Scotiabank.

EUR/GBP levels

EUR/GBP's price range is higher, moving between 0.8925 to the 0.8990 area on the day. On the wide, 0.9500 remains a key target while a reversal below 0.8743, the 14th July low and the 200-day ma at 0.8726, would be required to be a convincing reversal. A break to the downside would target 0.8530, being the 78.6% retracement of the move seen this year. 0.8954 is a sticky resistance, but a break of there and 0.8962 opens 0.8990.