EUR/GBP holds above 0.8800 and trims lossesv
- Pound loses strength but holds to gains after UK Court ruled that PM Johnson acted unlawfully when he suspended Parliament.
- EUR/GBP finds support at 0.8800 and rebounds modestly.
The EUR/GBP pair is falling on Tuesday, but so far it held above last week lows and also on top of 0.8800. It bottomed at 0.8802 and then rebounded. As of writing trades at 0.8820/25, around the same level, it opened the week.
The critical driver today has been the UK Supreme Court's ruling against the government. According to the decision, Johnson acted unlawfully when he suspended the Parliament just, and the prolonged prorogation was without reasonable justification. The Speaker of the House of Commons, Bercow, announced later he instructed authorities to prepare the resumption of business.
The expectations that a “no-deal” Brexit could be avoided boosted the Pound that initially jumped but quickly lost strength and trimmed gains.
Technical outlook
The EUR/GBP pair continues to move with a bearish bias, but so far in the very short-term, it is consolidating above 0.8800. The move off lows continues to face a critical barrier at 0.8850/55 while on the downside, the key support is 0.8800.
A firm break above 0.8850/60 would likely point to further gains for the Euro. Above the next resistance emerges at 0.8910 and then comes the upper limit of the current descendant channel (4-hours chart) that stands at 0.8970.
On the flip side, under 0.8800 the bearish pressure is likely to intensify, exposing last week lows at 0.8785 followed by 0.8735.