EUR/GBP clings to gains near multi-year highs

The shared currency maintained its outperformance against its British counterpart with the EUR/GBP cross holding on to its gains above 0.8800 handle, albeit has retraced from session peak.

Currently trading around 0.8815 region, the cross had a muted reaction to the release of better-than-expected UK services PMI print that surpassed consensus estimates and came-in at 52.6, down from 52.9 recorded in August.

Persistent bearish sentiment surrounding the British Pound amid renewed 'hard Brexit' worries coupled with bid tone around the shared currency on rumors of ECB QE tapering boosted the cross to level now seen since September 2011.

Going forward, the cross would continue to be driven by GBP price dynamics while focus remaining on any fresh news related to the Britain's decision to end its association with the European Union.

Technical levels to watch

Extension of near-term bullish momentum above session high resistance near 0.8840 region is likely to lift the cross immediately towards 0.8870-75 resistance area before attempting a move towards 0.8900 round figure mark.

On the downside, sustained weakness below 0.8800 handle is likely to find immediate support near 0.8765 below which the cross is likely to witness a corrective move towards 0.8715-0.8700 strong support.