Currently, EUR/GBP is trading at 0.8716, up 0.20% on the day, having posted a daily high at 0.8751 and low at 0.8697.

EUR/GBP is consolidating the recent rally from the 0.8650's towards the 0.8750's with a corrective fade back towards the 0.8700 level. The focus remains with a weak greenback enabling the euro to take flight within an environment where the ECB is speculated to begin changing its course in the near future. While a June hike is anticipated from the Fed, there are some reservations in respect to future moves in a lower inflationary outlook which is also supporting the euro in respect to yield spreads. 

Sterling wobbled badly overnight - Scotiabank

The cross was lifted recently on uncertainty around the UK elections with polls showing that not only are Labour catching up, but there were hung parliament fears derived from a YouGov election projection suggesting that the Tories could lose the Commons majority on June 8th. "We're supposed to treat polls with suspicion but needless to say, we remain bullish of EUR/GBP. Market positioning is much cleaner now and relative yield trends are friendly," explained Kit Juckes, economist at Societe Generale.

EUR/GBP levels

Analysts at Commerzbank noted that EUR/GBP has recently extended gains through the 2017 channel at 0.8702. "However we are extremely cautious as it did not sustain the break higher, however, neither has it broken down! For now, we will assume whole above the 200 day and 55-day ma at 0.8599/45 an upside bias remains to test the 0.8790 March high and potential to the 0.8852 January high. With no strong bias, we will exit our short positions for now. Below the 55 day ma will target the 18th May low, which guards the 0.8383 May low and failure here will retarget key support at 0.8334/04."