EUR/GBP soars through 0.8600 handle to hit nearly one month highs

After yesterday's brief pause, the EUR/GBP cross resumed its recovery momentum from last week's two-month lows and surged through the 0.8600 handle, and 100-day SMA barrier, to the highest level since Feb. 7.

Against the backdrop of renewed Brexit worries, today's disappointing release of UK Services PMI, missing expectations and falling to a 5-month low of 53.3 for February, continued weighing on the British Pound and helped the cross to build on to its early up-move. 

Adding to this, a solid recovery witnessed around the EUR/USD major further prompted traders to cover their bearish bets and collaborated to the pair's strong bid tone on the last trading day of the week. The cross prolonged its upward trajectory on possibilities of some stops getting triggered on a sustained move above the 0.8600 handle, lifting it beyond 100-day SMA hurdle. 

Technically, the cross has managed to move above 100-day SMA for the first time since the last week of January and hence, a follow through buying interest above February monthly highs resistance near the 0.8640-45 region should open room for continuation of the ongoing bullish momentum. 

Technical levels to watch

Momentum above 0.8640-45 area could get extended towards 0.8670 level, above which the cross seems all set to surpass 0.8700 handle and aim towards testing 0.8725-30 resistance area. On the flip side, retracement back below 100-day SMA immediate support near 0.8615 area, leading to a subsequent break through the 0.8600 handle, could drag the cross back towards 0.8550 intermediate support before eventually dropping back to 0.8500 psychological mark.