EUR/GBP back below 0.8700, Article 50 eyed

The now softer tone around the common currency is pushing EUR/GBP to return to the area below the key 0.8700 handle.

EUR/GBP focus on Article 50

The European cross came under further pressure today following a pick up in the demand for the Sterling and a renewed offered bias surrounding the euro.

The cross is poised to stay in the centre of the debate later in the session, as UK’s PM Theresa May is expected to trigger Article 50 passed the midday in the Old Continent, followed by a speech to MPs.

Triggering Article 50 will start negotiations expected to last at least two years (by end March 2019), and will see the UK leaving the euro bloc after more than 40 years of association.

Adding some concerns to the situation, the Scottish Parliament voted on Tuesday in favour of a second independence referendum, although timing and further details are still unclear.

EUR/GBP key levels

The cross is now advancing 0.07% at 0.8689 and a surpass of 0.8735 (high Mar.29) would expose 0.8788 (high Mar.14) and then 0.8860 (2017 high Jan.16). On the other hand, the next support is located at 0.8674 (20-day sma) ahead of 0.8614 (low Mar.28) and finally 0.8603 (55-day sma).