EUR/GBP drops toward September lows ahead of May’s speech

The pound is among the top performers during the American session boosted by a report from BBC according to which PM May will announce tomorrow the willingness of UK to pay EUR 20 billion for Brexit if it has access to the single market. 

“While she reportedly may not quote a specific figure in the speech, the gesture may help to foster a slightly more constructive dialogue between both sides during the next round of talks on Monday. But it is unlikely to be enough to convince EU leaders that enough progress has been made”, wrote James Smith, Developed Markets Economist at ING. 

EUR/GBP dropped from 0.8825 and fell to 0.8782 reaching the lowest since Monday. The pair is falling for the second day in a row and has erased all weekly gains. It is back near September lows. The recovery of the euro was short-lived and ended below 0.8900. 

EUR/GBP technical levels 

To the downside, the immediate support is seen at 0.8770/75 (Sep 15 & 18 low) followed by 0.8740 (Jul 14 & 17 low). . On the upside, resistance migth lie at 0.8835 (daily high), 0.8895 (weekly high) and 0.8980 (Sep 12 & 13 low).