EUR/GBP surges to fresh 7-week highs

The shared currency extended ECB-led up-move, lifting the EUR/GBP cross further beyond the 0.8700 handle to fresh 7-week highs.

In the post-meeting press conference, ECB President Mario Draghi's comments pointed to central bank's change in stance from accommodative to neutral.  Hawkish ECB attracted some fresh buying interest around the common currency and helped the cross to build on to its recent strong up-move from the vicinity of 0.8400 handle touched on Feb. 22.

Meanwhile, investors’ reluctance to buy the British Pound, amid renewed Brexit worries, has also been supportive of the pair's persistent up-move over the past couple of weeks. 

A follow through buying interest around the common currency, coupled with a range-bound price-action around the GBP/USD major, is assisting the cross to hold in positive territory for the sixth consecutive session. 

Currently trading around 0.8725-30 region, the highest level since Jan. 17, the cross is now all set to post second consecutive week of strong gains and might also be aiming for the highest weekly close of 2017.

Technical levels to watch

From current levels, 0.8750-60 zone is likely to act as immediate resistance, above which the cross is likely to aim towards reclaiming the 0.8800 handle and head towards testing yearly tops resistance near mid-0.8800s.

On the downslide, retracement move below the 0.8700 handle could get extended towards 0.8660-55 horizontal support, which if broken might trigger a near-term corrective slide back towards 100-day SMA support near 0.8600 round figure mark.