The EUR/GBP cross reversed part of tepid recovery gains to mid-0.8900s and is now fast approaching session low following the release of UK jobs report.
Currently trading around 0.8930-25 region, the cross ran through fresh offers after the Office for National Statistics reported that the UK claimant counts, change in the number of people claiming unemployment-related benefits, edged lower to 700 in September from previous month's 2,400. Meanwhile, unemployment rate remained at eight-year lows of 4.9%, while average earnings index matched expectations and came-in to show a wage growth of 2.3% 3m y/y.
Today's UK employment report provided an additional boost to the British Pound recovery momentum and held the EUR/GBP cross closer to a near two-week low touched on Tuesday in the aftermath of upbeat UK inflation data.
Meanwhile, a range-bound price action around the EUR/USD pair has failed to provide any impetus as investors now look forward to Thursday's ECB monetary policy decision and subsequent presser by ECB President Mario Draghi.
Technical levels to watch
Immediate downside support is pegged at 0.8915 level (yesterday's low), which if broke is likely to drag the cross immediately towards 0.8900 handle. A convincing break below 0.8900 handle might turn the pair vulnerable to extend its corrective move towards 0.8850-45 horizontal support.
On the upside, 0.8950 level now becomes immediate resistance above which the momentum is likely to get extended towards 0.9000 psychological mark. A follow through buying interest might continue boosting the cross further but any additional up-move might now be capped at 0.9050 strong resistance.