EUR/GBP rises toward 0.8700 amid a stronger Euro
- Euro rises on Monday on the back of hawkish comments.
- EUR/GBP finds support again at the 0.8570 zone.
The EUR/GBP is rising sharply on Monday, boosted by a stronger Euro across the board. The cross peaked at 0.8675, hitting the highest level since Wednesday. It is hovering around 0.8560, up more than 50 pips for the day so far.
Key support at 0.8570
Last week and also during October, the 0.8570 area capped the downside. The mentioned area continues to be a critical support that if broken would open the doors to more losses, targeting the 0.8500 area.
As long as the cross remains above 0.8570, losses seem limited. On the upside, the crucial resistance is seen at 0.8690/0.8700, the convergence of horizontal levels and the 20-day Simple Moving Average. A break above would strengthen the outlook for the euro.
Hawkish comments from ECB officials
European Central Bank President Christine Lagarde testified before the Committee on Economic and Monetary Affairs (ECON) of the European Parliament. She reiterated that interest rates will remain their main tool for fighting inflation. Earlier on Monday, ECB Governing Council member Klaas Knot pointed out that more tightening was necessary.
The comments boosted the euro across the board. EUR/USD hit a fresh multi-month high before pulling bank modestly while EUR/CHF peaked at 0.9888, a one-week high.
Technical levels