EUR/GBP retakes 0.9200 mark and beyond

The EUR/GBP cross caught some fresh bids on Monday and jumped back beyond the 0.9200 handle, recovering all of Friday's sharp losses.

The pair's recovery move from near two-week lows got an additional boost from today's disappointing UK construction PMI print, which unexpectedly dropped to 51.1 in August. The reading was weaker than previous month's reading of 51.9 and worse than 52.0 expected, weighed a bit on the British Pound.

Meanwhile, the market now seems to have digested Friday's report that the ECB may not be ready with its monetary stimulus reduction plan until December. Hence, a bid tone surrounding the EUR/USD major further collaborated to the pair's strong up-move through early European session on Monday. 

It, however, remains to be seen if the cross is able to build on the up-move amid increasing cautiousness ahead of the key ECB meeting on Thursday. 

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Technical levels to watch

Bulls would be eyeing for a strong follow through buying interest beyond 0.9220-25 area, above which the cross is likely to dart towards 0.9270 horizontal resistance ahead of the 0.9300 handle.

On the flip side, weakness back below the 0.9200 handle now seems to find immediate support near 0.9170 level, which if broken could drag the cross towards mid-0.9100s (Friday's low) ahead of its next support near 0.9125 area.