EUR/GBP erases gains, back near 0.8900

EUR/GBP spiked higher, rising above 0.9000 but it reversed dramatically and dropped back to the 0.8920 zone, erasing daily gains. 

Up and down on Draghi

The euro rose in the market when Draghi said that there was no discussion about extending the purchase program at today’s European Central Bank meeting. But the common currency lost momentum when the ECB President said that December decisions will tell what the central bank will do in the coming months and added that it is unlikely for the QE program to end abruptly. 

The pair reversed and turned to the downside. It continued to decline during the last hours and recently dropped to 0.8914, hitting a fresh daily low. The pair trading at the lows, holding a bearish tone, looking at the 0.8900 handle. 

Levels to watch 

To the downside, support levels might be seen at 0.8895/0.8900 (psychological / Oct 19 low), 0.8850 (Oct  6 high) and 0.8775 (Oct 5 low). On the opposite direction, resistance could be located at 0.8955/60 (Oct 19 high), 0.9000 and 0.9025/30 (Oct 18 and 20 high).