EUR/GBP hits fresh session high after UK retail sales, ECB awaited

The EUR/GBP cross extended Wednesday's tepid recovery momentum from 0.8900 handle and jumped to fresh session high following the release of UK monthly retail sales data.

Currently trading around mid-0.8900s, the cross maintained its bid tone after UK monthly retail sales data for the month of September fell short of market expectations and remained flat on a m-o-m basis. The y-o-y print also missed expectations pointing to a 4.8% growth and came-in to show 4.1% growth. 

The cross, however, lacked momentum amid lack of follow through buying interest as investors await for ECB monetary policy decision and subsequent press conference, where hints over possible taper or QE extension beyond March 2017 would provide fresh impetus and determine the pair's next leg of directional move.

Technical levels to watch

A follow through buying interest above 0.8958 (yesterday's high) is likely to assist the cross towards reclaiming 0.9000 psychological mark above which a fresh bout of short-covering seems to boost the pair towards 0.9025 strong horizontal resistance.

On the downside, weakness below 0.8925 level might continue to find support at 0.8900 handle, which if broken is likely to accelerate the slide towards its next major support near 0.8840 level.