EUR/GBP clings to gains near 0.8530 post-PMI

• The cross keeps daily gains above the 0.8500 handle.
• UK Services PMI disappointed expectations in March.
• PM T.May expected to ask EU to extend the deadline.

Alternating mood around the Sterling vs. a clear bid tone surrounding the shared currency is taking EUR/GBP to the 0.8530 region on Wednesday.

EUR/GBP met support near 0.8500

The European cross is recovering the smile as we’re navigating the middle of the week, so far reversing two consecutive daily pullbacks and managing well to rebound from weekly lows in the 0.8500 neighbourhood.

Further out, the upside momentum in the British Pound eased somewhat after the always-relevant UK Services PMI disappointed expectations and dropped to 48.9 for the month of March, the lowest level since September 2016.

On the Brexit front, PM Theresa May will ask the EU an extension to the current Brexit deadline and is expected to start talks with Labour leader J.Corbyn in order to tackle the ongoing deadlock in negotiations.

Furthermore around Brexit, Minister S.Barclay hinted at the likeliness that a ‘no deal’ scenario is still possible if the EU does not approve an extension to the deadline.

EUR/GBP key levels

The cross is advancing 0.07% at 0.8533 and faces the next hurdle at 0.8566 (21-day SMA) would aim for 0.8648 (high Mar.29) and finally 0.8657 (55-day SMA). On the downside, a break below 0.8502 (low Apr.3) seconded by 0.8483 (low Mar.27) and then 0.8471 (2019 low Mar.13).