EUR/GBP drops back below 0.8850

EUR/GBP is falling on Wednesday after a 2-day recovery. UK data pushed the pair to the downside, back under 0.8850. 

Downside pressure persists 

On Monday EUR/GBP bottomed at 0.8772, the lowest level in two months. From the lows bounced to the upside. The recovery found resistance below 0.8900 and lost momentum. 

Today, the pair was moving in a modest range and dropped quickly after the release of the UK retail sales report. Sales rose 1.0% in August, significantly above the 0.2% expected by market consensus. The pound gained momentum across the board and EUR/GBP fell to 0.8824. 

UK retail sales unexpectedly jump in August

The euro rebounded from the lows but the bounce was short-lived and at the moment EUR/GBP is moving toward daily lows, trading again below 0.8850. 

EUR/GBP technical levels 

To the downside, the immediate support might lie at 0.8825 (daily low), followed by 0.8800 and 0.8770/75 (Sep 15 & 18 low). On the upside, resistance could be seen at 0.8885 (daily high), 0.8900 and 0.8980 (Sep 12 & 13 low).