EURGBP is almost unchanged on the day as investors await outcome of the meeting between Boris Johnson and Jeremy Corbyn, who are reportedly meeting today to discuss a new programme motion. In the meantime, the EURGBP price continues to consolidate near the 5-month low.
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Reuters and the Times are reporting that Johnson and Corbyn are meeting now to try and agree on a new programme motion. Besides, Goldman Sachs expects the EU to grant a “technical extension” to UK three or four weeks beyond the Oct. 31 deadline.
“We maintain the view that approval of the existing Withdrawal Agreement is the most likely outcome of the current impasse, but we now expect a technical extension of three or four weeks beyond the 31 October deadline,” the bank said in a research note sent to clients.
EURGBP trades near the 5-month low of 0.8574, which is the 88.6% Fibonacci retracement level of the March-August move upside. The long-term support is located around the 0.8540 handle while the main resistance is the previous 6-month low of 0.8786.
The price action is wedging, thus we can expect an impulsive move in one of the two directions.