EUR/GBP clings to gains beyond 0.8600 handle ahead of Draghi's testimony

The EUR/GBP cross extended Friday's tepid recovery move from 2-month lows and is now building on to momentum back above 0.8600 handle.

Currently trading at fresh session peak level around 0.8620 region, the cross gained traction amid broad based recovery staged by the shared currency. In fact, the recovery momentum around the EUR/USD pair has helped the major to reverse all of its Friday's losses to the lowest level since December 2015.

Meanwhile, a range-bound movement around the GBP/USD pair has failed to provide any impetus and the cross has been solely driven by price-action surrounding the shared currency.

Later during NY trading session, ECB President Mario Draghi's testimony before the European Parliament would grab investors' attention and might provide fresh impetus for the next leg od directional move for the pair. 

Technical levels to watch

A follow through buying interest above 0.8635 (Friday's high) is likely to trigger a short-covering rally immediately towards 0.8700 handle, en-route 50-dayu SMA resistance near 0.8785 region. On the downside, weakness below 0.8600 handle, leading to a subsequent drop below 0.8585 horizontal support, is likely to accelerate the slide towards 0.8550 support area before the cross makes a fresh move towards 0.8500 psychological mark.