EUR/GBP clings to gains above 0.8700 handle ahead of Draghi

The EUR/GBP cross maintained its strong bid tone and is now sustaining its move to the highest level since mid-August. 

Currently holding above 0.8700 handle, the cross is now within striking distance of a multi-month high level of 0.8725 touched in the post-Brexit regime during August. 

An offered tone around the British Pound, amid renewed worries over Brexit, triggered the initial leg of up-move. Adding to this, upbeat German IFO business climate provided an additional boost to the shared currency and helped the EUR/GBP cross to extend its near-term bullish momentum to nearly 6-week high.

Focus now shifts to ECB President Mario Draghi's testimony before the Committee on Economic and Monetary Affairs of European Parliament later today, which might provide fresh impetus for the EUR/GBP cross traders. 

Technical levels to watch

A sustained move above multi-month high resistance near 0.8725 area is likely to trigger a fresh leg of up-move, lifting the cross immediately towards July 2013 highs resistance near 0.8770 region before darting towards reclaiming 0.8800 round figure mark.

On the flip side, weakness below 0.8700 handle now seems to be limited and is likely to be bought into near 0.8670 horizontal area. Only a decisive break back below 0.8670 support might negate near-term bullish expectations and trigger a short-term corrective move.